Procurement System – The Ultimate Guide For Professionals in 2021

For the procurement manager, a procurement system is as important as the money that is needed to procure the materials needed for the business. Without a working procurement management program, the company would probably waste a lot of money on buying supplies that are not just of inferior quality but must be expensive as well.

To get a clue on the importance of a well-planned procurement process, simply read on and learn what the procurement system is, what its functions are, and why it is important for a company that strongly relies on procurement for its daily functions.

The Definition of a Procurement System

So what is a procurement system? To put it in simple terms, it is a detailed and automated process of buying goods for the company. The procurement system is also responsible for maintaining the inventory system of the company. These days, it is a program designed and bought specifically to help the company in how it spends its budget for procurement as well as managing the supplies that were bought.

Some of the other processes that a procurement system takes care of automatically are as follows:

  • Generating purchase orders
  • Sending purchase requisitions
  • Approving delivered services/goods
  • Selecting/managing vendors
  • Reviewing invoices

The E-Procurement System Debunked

The e-procurement system may look intimidating and too advanced to people who are not very good with computers and other technical stuff, but to be honest, it’s not. The e-procurement system is the same as most procurement systems; its main function is to assist the procurement manager in automating and making complex tasks that would normally take normal person days or even months to finish. 

Most e-procurement systems have automated programming that allows them to do market research, sourcing tasks, and other data-relevant work that is important for the success of the procurement process. As such, it is now the job of the procurement manager or analyst to make sure that the company gets a good federal procurement data system that can really help with automating the procurement process while following important company standards.

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What do you Look for in an E-Procurement System?

Since we’re dealing with an automated system, it’s only natural for the procurement manager to take a look at the program and decided whether it is up to the task.

We at Procurement Tactics have devised several ways on how to check and decide which procurement system is the best choice for your company. You can check out our Negotiation Gamechanger course for more information on the topic, but since we’re feeling very generous towards our dear readers, here are some important features that you should check out in an e-procurement system before you decide to give the okay signal:

  • Customization – Most procurement systems are designed to handle multiple functions in case the organization needs to do other procurement processes too, such as sourcing, product and market research, and others. Companies of all sizes and types should get a procurement system where they are able to customize the program to how they see fit.
  • Workflow approval – The approval for the workflows in the procurement system should be quick and easy. The automation feature of an e-procurement system does just that. What takes months or weeks for a procurement manager to follow up can now be achieved in a few days.
  • Three-way matching – Good working procurement systems should have three-way matching functions in their programs. This particular matching system eliminates fraud by cross-checking invoices, goods receipts, and purchase orders. All of these are checked before payment is issued to the vendors.
  • Cloud hosting – Nowadays, procurement systems are now run on cloud hosting. It offers endless possibilities and data security as well. Self-hosting your procurement software is asking for trouble since the process is already outdated and has many flaws.
  • Vendor management – Procurement systems can now check and assist vendors with regard to the procurement process. Keep an eye out for procurement systems that offer vendor management as these programs can help you in assessing vendor performance, managing contacts, and onboarding vetted suppliers.
  • Spend Reporting – After the whole procurement process, there is always the checking of how much did your procurement go in terms of company spend. A program that can track your company’s spend footprint is a good find, so make sure to get a system that offers this particular feature.
  • Integrations – Integrations are important because procurement is not just about one process, but is made up of many processes. A procurement software that includes integrations to many other procurement processes is another great find, so go ahead and get that program if it does offer integrations!

The Advantages and Disadvantages of a Procurement System

A procurement system, like all other procurement processes and tools, also has its own set of advantages and disadvantages.

To help our dear readers learn each advantage and disadvantage, we at Procurement Tactics categorized each value in this neat little table. This is also to help prevent confusion as sometimes, a long wall of text can be quite overwhelming to read.

So without further ado, here’s a table on the advantages and disadvantages of a procurement system:

Advantages Disadvantages
Improved Speed – Automation makes everything faster and easier. Data comes in at the speed of light. Automation Errors – Because it is only a program, the system is also prone to errors, thus giving wrong data or value
Better Visibility – In a few clicks, the results of an analysis are presented to the user. A detailed breakdown is also given, listing every possible data or opportunity. Expensive Software – Sometimes, the best procurement software can be too pricey and is expensive to use
Good business transactions – Because the process is streamlined thanks to automation, business transactions are performed easily and without issues. Technology Update – Old companies that rely on traditional ways of procurement may have to get used to new technology.
Better supplier relationship – E-procurement software offers vendor tracking, thus any issues that could arise from the procurement process can be dealt with easily between the company and the vendor.
Guided Buying – Money is well-spent because the program sets a budget limit for the procurement process.


What is a procurement system?

A procurement system is the automation of procurement processes. 

How to create a procurement system?

You create a procurement system with the use of automated software.

What are procurement system best practices?

Some of the procurement system best practices include assigning the menial tasks to the automated software while the procurement team takes care of the critical tasks.

And now, a word for our procurement managers!

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We have tons of information to share with all procurement managers and negotiators who are keen on improving their skills. Hurry and avail of our limited offer today!

Chat with us at for more information.

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