Sourcing for goods and services is crucial part  of the supply chain yet one that until late has resisted
automation. For many companies finding the best materials or services at the best price and under the most
advantageous shipping arrangements is a laborious process.E-sourcing  includes using web based
technologies to automate and streamline  the identification, evaluation, negotiation and configuration of the
optimal mix of suppliers, products and services into supply chain  network that an rapidly respond to
changing market demands. Supporting the complete sourcing cycle will require companies to configure  the
appropriate  mix of technologies, strategy and product and supplier expertise into e-sourcing frame work.

The world of web based purchasing, with market places, exchanges, and auctions, is still evolving. The
advantages  to being able to scour the world for the best goods at the price  sounds  great  theory, but is
not always great in practice. The  business world is moving towards  e-transport, e-logistics, e-sourcing and
e-procurement. These web based methods helps into cost reduction strategies

E-procurement has following advantages

  • reduced transaction costs, in an area of the total spend that dwarfs what's spent on indirect goods

  • reduction of stocks of obsolete  products and inventory for those products, owing to more timely
    reaction of supply  to demand

  • reduced level s in general, through reduced cycle times

  • quicker reaction to changing market trends enabling a manufacturer to gain competitive edge in new
    product development.

  • redeployment of procurement and other professionals away from transaction processing activities
    toward work that is more strategically important  such as global

  • market research and analysis, long term negotiations with strategic suppliers, supplier development
    and researching of new technology tools  that can elevate procurement  and supply chain
    management performance


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