supply chain management

(redirected from E-procurement)
Also found in: Dictionary, Encyclopedia, Wikipedia.

Supply Chain Management

The act or process of ensuring that one's business has the proper supplies in order to continue operations. Supply management involves ensuring that supplies are procured as cheaply as possible. For example, a construction company must procure cement, wood, and nails efficiently and inexpensively; equally, a consulting firm must make sure that research materials are easily available. Large companies often devote whole divisions to supply chain management, giving them budgets of millions of dollars to help the company save money.

There are two basic types of supply chain management: just in time and just in case. A just in time supply chain management strategy involves keeping only enough inventory to meet immediate business needs. This requires constant monitoring but can save a significant amount money. A just in case strategy, on the other hand, keeps a larger inventory to meet unexpected increases in demand. This saves less money (depending on the nature of the business and matters like carrying costs) but can be easier to manage.

supply chain management

a term used to describe the management of inventory (STOCK), not only within a firm but also along the network of suppliers and customers which constitute the SUPPLY CHAIN or VALUE-ADDED CHAIN. Supply chain management employs a variety of methods such as STOCK CONTROL, MATERIALS REQUIREMENT PLANNING and DISTRIBUTED REQUIREMENT PLANNING to both minimize stock-holding costs while maintaining effective distributed levels of servicing customer orders. See SUPPLIER DEVELOPMENT.
References in periodicals archive ?
Does e-procurement represent a new and effective way to reduce purchasing costs?
based Coupa also says it offers the first on demand e-procurement solution for SMBs that automates the entire purchasing process--from requisition, approval and purchase-order creation to requests for quotations (RFQs), quotations, receiving, inventory and invoicing.
According to a new study by the Aberdeen Group, "The 2006 E-Procurement Benchmark Report: E-Procurement 2.
In 2003, the University of Chicago chose AcquireX as the e-procurement provider for the university's Campus Computer Stores.
E-procurement has opened up the competitive process.
The benefits of e-procurement to purchasing organizations include lower transaction costs, faster ordering, greater selection of suppliers, and reduced maverick buying.
The benefits of e-procurement are clear," said Claire Ighodaro, financial controller at BTopen-world and vice-president of CIMA.
With e-procurement, the time needed to issue a manual purchase order, place the order and follow-up with a vendor can be reduced to a few simple points and clicks.
With e-procurement, such order tracking is simplified and needs to be done only if there is a problem.
E-procurement is one example of bow the Internet has revolutionized the way businesses interact.
For most corporates, return on investment seems to be the last thing on their minds, although a recent KPMG report into e-procurement indicates that it could provide companies with up to 15 per cent savings.
Almost all, or 98%, of the fifty heads of purchasing interviewed in the survey said that they believe it is important for an e-procurement vendor to employ professionals with relevant purchasing expertise to design and implement e-procurement systems.