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Supplier Enablement Shouldn't Stop with Top-Line Suppliers

Top-line suppliers should be a business’s priority for supplier enablement, but offering enablement to the supplier tail is more cost-effective than you might think.

Why do businesses invest in eProcurement platforms? There are many possible answers. To gain insight into spending. To anchor procurement to accountable processes. To reduce procurement errors and take control of rogue spending. But, at a fundamental level, eProcurement is about building stronger and more effective relationships. That includes relationships between buyers and their managers, between business departments and procurement professionals, and, most important of all, between businesses and their suppliers.

Supplier_enablement.jpgIntegrated eProcurement helps businesses build supplier relationships that don’t suffer from the delays associated with manual procurement processes. Instead of wasting valuable staff time rectifying common procurement errors, buyers and suppliers can focus on generating value for their customers. The seamless flow of data between eCommerce applications and eProcurement platforms helps both sides of the transaction avoid errors that can result in damaging disputes.

But to fulfill the potential of eProcurement, suppliers must be enabled to integrate with buyer eProcurement platforms. It’s no longer feasible to drop a pile of documentation on a supplier and demand that they integrate with your platform. That works for some suppliers, but comprehensive supplier enablement depends on a level of automation that traditional onboarding doesn’t provide.

Modern supplier enablement isn’t just about delivering the information suppliers need, but giving them the tools they need to automatically harmonize transaction data between eCommerce and eProcurement platforms — a two-way relationship that benefits both partners in the transaction.

What percentage of your business’s suppliers are integrated with its eProcurement platform? For many businesses, it’s no more than 20%, with 30% considered a good level of integration. Why so few? Because custom integrations are expensive, time-consuming, and complex. Historically, it may not have made sense to invest in supplier enablement for suppliers that were less important to the strategic goals of the business. Businesses focus on top-line suppliers, reasoning that by enabling their most important suppliers, they’re capturing transactions that represent the bulk of their spending.

However, the bulk of dollar spend is rarely the bulk of transactions. The purpose of enabling suppliers with automated order and invoice harmonization is to reduce errors, manual processing, and wasted time. Creaming off the top few suppliers for enablement doesn’t satisfy that goal since there are almost certainly more transactions overall from the supplier tail than from a few top-line suppliers.

Consider the number of transactions your business handles in a year. What percentage of those transactions involve top-line suppliers? For most businesses, it’s nowhere near a majority. It is, of course, important to prioritize high-spend suppliers for eProcurement integration and data exchange automation. But to fulfill the potential of your eProcurement platform and to build more efficient and sustainable relationships with suppliers, it makes sense to offer the same enablement process to a broader cross-section of suppliers. And, with a modern supplier enablement and B2B automation solution, doing so is not nearly as complex or expensive as you might think. Suppliers lower the cost to serve customers and create efficiency along the way, creating a win-win for buyers and suppliers alike.

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