In the face of supply chain disruptions and market volatility, it’s more important than ever for procurement teams to make informed, data-driven sourcing decisions that ensure long-term value and business resilience. eSourcing software facilitates this by enabling teams to collect and analyze complex data to find the best solutions for their needs, while also streamlining their operations to win back time for strategic work. The right tool can powerfully benefit your business, delivering significant cost savings and impressive efficiency improvements across your entire organization. Still wondering what eSourcing software is and if it’s right for your company? In this article, we’ll cover everything you need to know.
eSourcing refers to using electronic tools, platforms, or software to oversee the sourcing process. This includes identifying potential suppliers, requesting and gathering bids, negotiating contracts, and selecting vendors. The goal of eSourcing is to streamline and digitize the entire procurement lifecycle, from identifying needs to the final contract award.
What’s the difference between eProcurement and eSourcing?
eProcurement and eSourcing both refer to digitizing part or all of your supply chain management and procurement processes, but they have different functions.
eProcurement uses software and technology to manage the entire procure-to-pay (P2P) cycle, covering all aspects of procurement from beginning to end.
eSourcing covers the first and most foundational stage of the procurement cycle. It optimizes sourcing to help you save time, make better vendor decisions, and maximize value throughout the entire procurement process.
What are eSourcing tools?
eSourcing tools are a subset of the broader procurement software market, designed to streamline the sourcing process and enable buyers to select the optimal providers of goods and services for their business.
They make it easier for procurement teams to get and evaluate key documents, like requests for information (RFIs) and requests for proposals (RFPs), and use AI-powered scenario and bid analysis to improve decision-making based on a range of price and non-price criteria that matter to your company.
Modern eSourcing tools and sourcing software use a combination of autonomous sourcing, sourcing optimization, and data analysis to speed up and simplify strategic sourcing activities, improve vendor relationships, and save valuable time for procurement teams by removing tedious manual admin.
eSourcing software has benefits for your procurement team, your requestors, your suppliers—and your business’s bottom line. Here are five of our favorite benefits of using eSourcing software.
1. Save time
eSourcing tools with sourcing automation can remove up to 100% of manual work for tactical and tail spend, freeing up hours for your procurement team every week. Let requesters kick off sourcing events themselves using custom workflows and bots that follow your team’s best practices, or integrate your eSourcing tool with your inventory lifecycle management software to automatically initiate repeat purchases when key items get low.
Keelvar’s Autonomous Sourcing removes up to 100% of manual work, saving hours for your team every week
Empower business users to source like pros for increased productivity. With an easy-to-use eSourcing tool, requesters can start an automated sourcing event using natural language—no training necessary. Build in controls and approval workflows as needed to ensure purchases meet compliance needs without needing to micromanage. Bring more spend under control and get visibility over all procurement across the business.
Plus, easily collaborate with suppliers and vendors during the procurement process by centralizing all communication in one platform. Manage all supplier relationships from one place to remove silos, negotiate more effectively, and increase transparency.
Keelvar’s eSourcing tool has a user-friendly interface that enables requesters to easily start automated sourcing events
3. Data-driven decision-making
Leverage AI to analyze even the most complex data and largest sourcing events. Sourcing optimization software goes beyond cost to consider multiple factors—like risk, quality, and sustainability—so you can make the best decision for your business based on long-term value and total cost of ownership (TCO).
Sourcing optimization software uses AI to collect and analyze even the largest, most complex datasets so you can make informed award recommendations
4. Cost savings
In addition to helping procurement teams save money by finding the best value options for their business, eSourcing software unlocks even more cost savings by encouraging competition between suppliers. Using eAuctions and flexible bidding, you can enhance negotiation dynamics in a fair and transparent environment to ensure you get the best deal.
Using eAuctions is one way eSourcing software can improve supplier negotiations and save money
5. Scalability
In traditional sourcing, teams are often limited to emails, phone calls and spreadsheets. These tools limit collaboration, transparency, and automation, and are impossible to scale. But in order to have the greatest impact across your organization, bring more spend under governance, and ensure you’re always following best practices (and meeting compliance requirements), scalability is essential.
The right eSourcing software supercharges your procurement function without needing to add more headcount. It automates the simple stuff, removes the need for hand-holding and time-consuming team trainings, and supports strategic sourcing. All of this means you can scale sourcing excellence across your business and get the best outcome in every sourcing event, no matter how big or small.
Build custom workflows in Keelvar to scale your best practices across your entire organization
Why invest in eSourcing solutions?
With supply chains and markets still in flux, procurement transformation has become a top priority to help teams navigate disruptions and keep businesses moving forward.
In recent years, the goal of sourcing has also moved far beyond simply cost reduction. Now, organizations want to create lasting supplier relationships that factor criteria such as cost, quality, risk management, sustainability, and supplier innovation into their decision-making.
Sourcing leaders are also under pressure to consider sustainability targets and corporate social responsibility (CSR) objectives that are increasingly included in stakeholder ambitions for their businesses.
At the same time, sourcing is becoming more complicated, as:
Different spend categories have different needs
Disruptions and unpredictability require greater agility and speed
Teams are flat or shrinking, not growing
Skill sets vary, and companies have to compete for talent due to expertise shortages
Dedicated eSourcing software combines sourcing automation and sourcing optimization to help teams better manage these and other challenges, including supplier capacity limitations, freight volatility, and supply chain pinch points.
By enabling you to conduct robust analytics on large volumes of data, automate your workflows, and optimize your strategic decision-making, eSourcing software delivers an impressive ROI that maximizes value throughout the entire procurement process.
Ready to transform your sourcing? Here are two powerful tools to consider.
1. Keelvar
Keelvar is an all-in-one eSourcing solution that combines AI-powered sourcing automation and sourcing optimization in one intuitive, user-friendly platform. It reduces manual sourcing work, enhances strategic sourcing, and scales sourcing excellence across your entire organization.
Keelvar is a powerful eSourcing solution that optimizes the sourcing process to deliver impressive results
Keelvar's eSourcing tool enables teams to go beyond simplistic supplier award decision-making driven solely by a lowest-cost model.
With Sourcing Optimizer, buyers can collect a wide range of price and non-price bid information from suppliers, then analyze multiple awarding scenarios based on those criteria as well as other constraints and preferences.
Autonomous Sourcing automates tactical and tail spend, reducing manual admin work and increasing competitive bidding for smaller spends. It frees up teams to focus on big- picture strategic sourcing tasks while still ensuring the best possible sourcing outcomes for your business.
And the results speak for themselves. With Keelvar, teams can enjoy:
Cost savings of 15–22% as more spend categories are optimized
Operational time savings averaging 50% by supporting process excellence
Sourcing risk reduction due to improved decision-making behind supplier award, as well as enhanced compliance
“We’ve got this awesome Optimizer that we use to run large scale, complex sourcing events. But then we’ve also got the autonomous sourcing piece of it now, which is built onto the Optimizer, so you don’t even have to train the teams to use it. You now have a bot do all the work of building and creating the events for you.”
—Sam de Frates, Vice President, Commercial – Europe, CIS & Turkey, Mars
2. SAP Ariba
SAP Ariba is a procurement software suite that was built to integrate with other SAP ERP products. It covers the entire procure-to-pay (P2P) process for enterprise organizations with complex systems.
Key features include automation, integration with enterprise resource planning (ERP) systems, compliance monitoring capabilities, and access to SAP Ariba’s global supplier network.
💡 Did you know? Keelvar’s Sourcing Optimizer directly integrates with SAP via an API, allowing SAP customers to seamlessly add optimization and automation to their large or complex spends.
Streamline your sourcing process with the right eSourcing software
As strategic sourcing becomes more important to forward-thinking procurement teams, there’s never been a better time to adopt a best-in-class eSourcing tool. With the right software, you can go beyond basic procurement processes to upgrade your sourcing and drive long-term value throughout the procurement cycle and beyond. Want to see how Keelvar’s eSourcing software can elevate your business? Request a demo today.
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