Research reveals SMEs are realising the benefits of procurement
Small to medium-sized enterprises (SMES) are benefitting from procurement similarly to large organisations in the way of reducing costs, controlling spending, and maximising the efficiency of labour, according to new research.
The eProcurement provider Wax Digital questioned 260 senior managers working for UK businesses with a turnover of £50mn to £250mn.
With the survey having gauged the thoughts on when procurement should be introduced into organisations, the results came back as follows:
- 77% claim to need procurement by the time it has 100 supplier contracts.
- 75% said procurement was needed once a company reaches a £50M turnover.
- 72% said once 500 invoices per month are being processed, procurement was necessary.
The survey revealed that procurement had been administered as a proactive measure by 31% questioned, with 48% implementing it as a reactionary measure to poor performance, demonstrating that many businesses have not recognised the tipping point at which they should introduce procurement.
Of the 82% of those surveyed that had experience of introducing procurement into their firms, the majority revealed that doing so was a significant priority for them prior to implementation.
In response to the research, Wax Digital’s Managing Director Paul Ellis stated that proactive measures in introducing procurement are more desirable, but in any case, SMEs are recognising the benefits that procurement can bring.
“In spite of the barriers to adoption experienced by some of our research respondents, none of these challenges are unsurmountable, and forwarding thinking organisations will recognise their tipping points and put in place the necessary procedures to prevent a negative situation happening in the first place.”
“No two businesses are the same and each will have its own procurement tipping point.
“The research shows that UK businesses are realising that formal procurement isn’t just for large organisations, and that any business that wants to control spend, improve its supplier performance and eradicate slow admin-heavy processes from the business can benefit from the adoption of a more professional approach to procurement.”
SAP Ariba to digitise procurement for Expo 2020 suppliers
The global trade event, this year hosted in Dubai, was rescheduled from last year and will now take place between 1 October 2021 and 31 March 2022.
As the event’s Innovative Enterprise Software Partner, SAP Ariba solutions will fully digitise and automate the procure-to-pay lifecycle, providing a streamlined experience for thousands of market leading, global suppliers and strengthening the global supply chain with enhanced transparency and efficiency. The cloud-based platforms operate through on SAP Ariba’s UAE public cloud data centre and connects to the Ariba Network.
Expo 2020 "a long-term investment"
Mohammed AlHashmi, Chief Technology Officer, Expo 2020 Dubai, said the world trade event is “a long-term investment in the future that aims to enhance opportunities for sustainable business connectivity and growth”, which stretches beyond Expo 2020’s six-month window.
“Our partnership with SAP is an example of what can be achieved with the invaluable support of our technology partners to host one of the most digitally advanced World Expos ever,” he added. “The implementation of SAP Ariba solutions has transformed our end-to-end procure-to-pay cycle and helped set new standards of procurement automation for projects of this scale.”
To date, more than AED 1bn has already been transacted by Expo 2020 suppliers through SAP Ariba. The platform promotes collaborative partnerships and allows registered users to participate in sourcing events, negotiate and initiate contracts, and centralise their invoicing and payments in real time.
Claudio Muruzabal, President of EMEA South, SAP, said: “Expo 2020 Dubai is demonstrating global best practices in digitising its procurement process with SAP Ariba solutions to help gain visibility into its spend, tighten collaboration with its suppliers, and achieve process automation, including completely paperless invoicing.”
About Expo 2020 Dubai
Expo 2020 will take place in Dubai and is the first of the long-running World Expos to be hosted in the Middle East, Africa and South Asia territory. The original World Expo, called the Great Exhibiton, was hosted in 1851 at the Crystal Palace in London, designed as a showcase for the innovations of the Industrial Revolution.
Expo 2020 was originally due to run 20 October 2020 to 10 April 2021, but was last year postponed in light of COVID-19 restrictions - though some business has already taken place virtually. The event will place greater emphasis on innovation in sustainable solutions through the Sustainability District, blending technology and culture. It is expected that around 70 per cent of the 25 million attendees will be international visitors.