Procurement outside the platform – case analysis
The use of a procurement platform in the procurement process is more and more common, however it is still not the dominant practice. The view on the approach to the offer presenting process in other companies, who hitherto have not used e-procurement solutions, is quite interesting. It also allows to work out a basis for comparisons at the level of the selected efficiency indicators.
In the discussed companies, the publication of requests in open form is a common, yet not dominant practice. It allows to diversify suppliers and to maintain a greater number of offers. Publication of requests in closed form can shorten the procurement process, however it prevents participation of potential suppliers, who could present an extremely competitive offer.
For companies that do not use e-procurement solutions, a satisfying number of offers in response to a request for quotation is up to three responses. This limits the competitiveness of the offers, and thus it limits the possible savings. However, such a small number of offers allows to shorten the time of the procurement proceeding. Some companies opt for informing a greater number of suppliers about the proceeding, which does result in an increased number of offers, but it significantly prolongs the duration of the entire procurement proceeding.
In many cases, the procurement negotiations are the key to obtaining a satisfactory price. However, these are time-consuming, so it is understandable that only some companies undergo these with all bidders. More often than not we can encounter an invitation for negotiations aimed at only selected companies, which allows to optimize the relationship between the time consumption of the negotiation process and the benefits arising out of undergoing it.
Of course, the time needed to collect a satisfactory number of offers depends on the number of suppliers that were invited to the proceeding. A low number of suppliers and a low-set limit for the satisfactory number of offers results in a quick (even as quick as three days) collection of responses. However, the short time of collection of the offers does not compensate for their low competitiveness, and thus it results in a low level of savings.
HOW LONG DOES IT USUALLY TAKE TO GATHER A SATISFACTORY NUMBER OF OFFERS?
New contracting partners are a chance to diversify the offers and obtain new low price levels, that is why inviting new suppliers is a well understood necessity. Although the ratio of the invited new suppliers and the number of published requests for quotation varies, a vast majority of companies sees such a necessity in the case of most proceedings.
Requests for quotation in open form, appropriately aimed procurement negotiations and invitation of new suppliers, seem to be the most promising direction of development for the procurement department. However, without utilization of e-procurement tools, even the most finely planned process will not generate the maximum possible savings.