International Consultants' Guide

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E-Supply Chain Procurement

Wasted Opportunity

Alison Barnes says European manufacturers are failing to take advantage of e-procurement.

While the use of technology has pervaded almost every aspect of business life, one area which continues to languish in the dark ages is procurement. This is despite the fact that procurement costs, in general, can represent 1-2% of goods purchased; and in many cases, the cost of procurement can even exceed the cost of the goods themselves.

In addition, for many businesses, cost is not the only issue regarding procurement. It can have a major impact on the organisation itself, particularly where the goods or services involved are critical to the business process.

In manufacturing, for instance, the availability of even a relatively minor piece of equipment can affect the efficient running of plant, or even bring it to a standstill; and in this, as well as all other sectors, the sheer amount of resource involved in procurement means that managers are distracted by routine, day-to-day matters instead of concentrating on strategic issues that could be vital to the company's future.

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