7 Steps to A Procurement Process

For many businesses to operate effectively and efficiently, they must procure goods and services from various suppliers. Making a procurement process an integral part of any organization. With so much at stake, creating a strategic sourcing process is a must. 

For an effective procurement and strategic sourcing process to be successful, it must help a company save costs, aid in compliance, and ensure it works with reputable suppliers. Another important advantage of having a procurement sourcing strategy is that it gives an organization the ability to create and achieve sustainability and environmental goals, such as reducing environmental impact. 

The following steps can be used to start your procurement process. 

Step 1: What Are You Procuring?

The first thing you want to do is figure out what your goal is, and what exactly you need to source in order to achieve that goal. What is your procurement cycle? Once your goal is set, you will then be able to begin shopping for your supplier. 

Step 2: Supply Market Analysis

Before choosing your supplier, you will need to determine your purchasing power and determine what strategy will best fit your needs.

Step 3: Develop a Strategic Sourcing Strategy

Knowing how and where to find the best suppliers is essential. When selecting a supplier pool, you should consider suppliers you have worked in the past, and ones that are new potentials. You will want to supply each supplier with your requirements and goals.

Step 4: Select The Strategic Sourcing Process

Once your requirements are defined it’s time to send out some bids, typically in the form of RFP's. These request for proposals will outline the details. such as the product or service specifications, requirements, pricing breakdown, legal and financial terms and conditions, etc.

Step 5: Negotiate with and Select Suppliers

Once your proposals start coming in, it is time to start narrowing down the list of suppliers and asking the right questions to negotiate the best terms. 

Step 6: Implementation and Integration

Once you have negotiated your terms, it is time to make sure you notify your winning suppliers. Your organization should begin to integrate your chosen suppliers into everyday discussions and procedures, making sure they’re up-to-date on the most recent changes and updates.

Step 7: Benchmarking 

To ensure sustained success, it is very important to measure the supplier’s performance over time. You will want to start with recording the current status of your company before signing on with a new supplier, and you will want to continue monitoring results periodically.

Ananta Energy Source Electricity and Natural Gas Procurement Service

Stay competitive in the market with Ananta Energy’s open-book energy procurement solutions and start saving on your energy bills.