Catalog Purchasing

Catalog Purchasing

Catalog Purchasing (Procurement) refers to a purchasing process that uses catalog data. Today, it is still common practice for a requester to fill out a requisition form (sometimes still a paper form) in a specialized department and this is forwarded to Purchasing where an order is generated based on the request.

We'll show you how catalogue shopping can be simplified.

The traditional approach leads to the purchasing department being burdened with tasks that do not require special purchasing know-how, the process costs are significantly higher than the savings achieved, the process takes a long time, and this leads to dissatisfaction on the part of the requester.

In this situation, it is appropriate to introduce catalogue purchasing, which moves these activities directly to the applicants in the specialist departments. We are all used to using e-shops for shopping in our private lives. Therefore, we have brought this purchasing process into the corporate world and extended it with business-as-usual rules. This makes catalogue shopping in our system easy for the average internet user.

Schematic representation of the process:

The starting point is the catalogues from which the applicant selects the desired items as in the e-shop. He collects them in the shopping cart and prepares them for ordering.

However, the choice of appropriate catalogues is still the responsibility of purchasing.

For each group (category) of items, one or more approved catalogues are selected from which applicants may order. These are catalogues with agreed terms and conditions and prices or a discount.

Approved catalogues are selected in a competition, e.g. by sourcing.

Contracts are concluded with catalogue suppliers and their catalogues are uploaded to the Promitea system.

Each requester will be given access to those catalogues from which they are authorised to order items.

Dodatečná alternativa: Pro vybrané skupiny zboží si můžete sestavit firemní katalog dle vašich potřeb. Může se skládat z položek, které jsou evidovány v systému ERP nebo mohou být nákupem doplněny z jiných zdrojů.

Access to foreign catalogues is also possible. These are catalogues that use OCI and Punch-out standards. For not very frequent searches for C-items (marginal items), Promitea has prepared access to shopping marketplaces such as Mercateo and Amazon Business.

After the requester selects the desired item(s), the shopping cart is forwarded for approval. The approval process is multi-step. Here is an example of how the rules can be set up:

• Purchase value up to 50 Euro: automatically approved by the system

• purchase value up to 200 Euro: approved by the 1st level approver (e.g. manager)

• Purchase value > 200 Euro: approved by 2nd level authoriser, etc.

• A budget may be defined for each applicant or his/her department, which may not be exceeded within a certain period of time. For each approval, it is indicated to what extent the budget is already spent.

Promitea offers a comprehensive setup system that is determined by the purchasing department.

This system arrangement allows the following mode of operation:

• the requester orders as in the e-shop
• shopping cart is electronically approved and budget availability is checked
• the whole process does not burden the purchasing department and is considerably shortened
• based on the data in the shopping cart, an order is automatically generated after approval

The order initiates the order to pay (O2P) process. This process can be carried out in the ERP if agreed between the buyer and the suppliers.

If this is not the case, Promitea offers its own electronic O2P procedure based on WebEDI.

WebEDI-based O2P is particularly suitable for smaller suppliers who do not yet have EDI in place.

What results can be achieved with catalogue purchasing?

The company-wide introduction of agreed and binding catalogues leads to cost savings of 10%. This is achieved by basing all orders on the agreed items. This concentrates the volume of purchases on the approved item, which can then be implemented under better conditions.

Additional cost reductions are achieved e.g. in logistics and lower maintenance costs, this applies to items such as PCs, printers, etc. (TCO)

In percentage terms, higher savings in process costs are achieved. They range from 50 to 80%. A further advantage is that spare capacity in the purchasing department can be used for strategic tasks.

Summary: Using Promitea in these three key areas of purchasing results in substantial savings quickly, cost-effectively and without risk.

By laying the foundation for the digital transformation of shopping, the scope for further optimization is opened up. The data obtained using the above methods can be used to improve purchasing tools, thereby improving the purchasing process and strengthening the role of purchasing in the company.