In an era of rising prices, budgetary constraints, and uncertain enrollment numbers, there is increasing pressure to streamline processes, reduce costs, and do more with less.
Today’s higher ed institutions are experiencing a significant drop in tuition revenue, contributing to a 70% increase in the number of colleges facing financial distress. This situation is particularly critical as many states are facing their own financial challenges, prompting a closer examination of higher education budgets. The strain extends to K-12 schools, where budgets are struggling to keep pace with rising prices. Several states have been forced to enact cuts and scale back financial support to local schools.
For procurement teams and financial administrators, the picture is clear. You need to find greater efficiencies and reduce costs wherever possible without sacrificing quality or essential services. It is a tall job and a critical one.
eProcurement helps educational institutions overcome these challenges and accelerate the entire procurement lifecycle. In this Education eProcurement 101 guide, we will explain the objectives and benefits of eProcurement, the different types of eProcurement tools and solutions, how to select an eProcurement system, and the best practices for a successful implementation. We start with an eProcurement definition.
eProcurement is key to efficient procurement practices within educational institutions, facilitating the seamless acquisition of essential goods and services. Through digital tools and automated workflows, eProcurement optimizes each phase of the procurement process — from sourcing to purchasing to managing vendors and contracts — leading to substantial savings in both time and financial resources.
By integrating technology-driven solutions, educational entities can integrate their procurement procedures, enhancing overall operational efficiency and resource allocation.
Today’s eProcurement tools also leverage the cloud for Software as a Service (SaaS) solutions. This allows greater mobility for remote and hybrid teams as well as making eProcurement software available across districts or campuses to authorized users. Cloud-based eProcurement tools enable digital communications across the end-to-end procurement lifecycle, connecting buyers and sellers.
Using an eProcurement system produces tangible benefits almost right from the start. Some of the key objectives eProcurement software helps you achieve include:
By streamlining workflows and automating complex purchasing processes, eProcurement presents significant advantages in terms of operational efficiencies and cost reduction. It is estimated that as much as 80% of manual tasks associated with paper-based workflows can be automated to reduce workloads and accelerate the procurement lifecycle.
An eProcurement system allows educational institutions to streamline procurement cycles, reducing transaction timelines and delivery timeframes. Given the recent challenges in obtaining essential goods promptly, there is a pressing need to expedite approval processes to prevent fulfillment delays.
eProcurement tools are equipped with robust compliance features that enforce strict adherence to purchasing policies and regulations, promoting transparency and accountability within the procurement framework.
By consolidating your procurement process, you can encourage buyers to use preferred vendors and pre-negotiated contracts to maximize savings. This dramatically reduces maverick spending, which can add up fast. A study by the Hackett Group reported that nearly a third of all indirect spending is off-contract.
Comprehensive data collection and analysis enable schools and universities to derive valuable insights to aid strategic procurement planning and inform purchasing decisions.
eProcurement platforms can also be used to manage the tendering and bidding process between buyers and sellers. The software provides a platform to facilitate requests for quotes (RFQs) and bidder responses in a single place for faster review. This significantly accelerates the bidding process and fosters competition among bidders.
Educational institutions have several options when it comes to implementing eProcurement software. The right solution depends on your organization’s size, needs, and budget. Solutions include:
Purchasing cards (P-cards) offer a simple way to digitize some procurement spending. These commercial credit cards look like regular cards but come with built-in controls and reporting tailored for business expenditures. Employees can use preset limits and expense coding right on the card.
P-cards provide an efficient way to pay for high-volume, low-cost goods without having to issue individual purchase orders. They reduce petty cash usage and streamline the purchasing process for items like office supplies, maintenance parts, and small-scale services.
Modern P-cards have robust cost controls to limit spending within thresholds and restrict certain purchase categories or preferred vendors. Some P-cards can also integrate directly with accounting systems.
eProcurement software is designed specifically for automating and managing the entire procurement process for organizations. These platforms provide end-to-end support for the full procure-to-pay lifecycle.
Online Marketplaces represent centralized hubs where multiple buyers and suppliers come together. Educational buyers can browse catalogs and compare pricing across a network of vendors. Online marketplaces streamline sourcing, allow electronic transactions, and provide market intelligence.
E&I’s online marketplace connects schools and universities with a portfolio of supplier contracts in a pre-loaded, secure environment. You can take advantage of pre-negotiated terms, compare them to your contracts and pricing, or add your own supplier catalogs for greater flexibility.
EqualLevel, sponsored by E&I, is a fully digital supplier network for eProcurement, enabling your users to shop the same way they would on any eCommerce site. It comes loaded with E&I contracts, and you can also add non-E&I contracts. Features include:
When you are evaluating eProcurement solutions, there are several key factors to consider. First, look for an eProcurement partner that specializes in the education sector. They understand the institutional environment and the unique challenges you face. This will help you implement a system that meets your needs and is backed by experts who know the educational space.
Other key factors include:
Being able to work online, whether in the office, remotely, or across campus, is crucial for education procurement teams. A cloud-based eProcurement platform allows approvers, requesters, and other authorized users to manage the process on the go via secure mobile apps or browsers.
A robust eProcurement solution should seamlessly integrate with your existing accounting or ERP system to enable automated data sharing. Unintentional data errors from manual re-keying or out-of-sync data among different platforms can cause significant problems. You need tight integration that provides an accurate, consistent, and comprehensive view of spend across the organization.
Look for an end-to-end platform that fully supports your organization’s procure-to-pay process — from sourcing to payment. A unified system streamlines workflows and provides total visibility and control over the entire procurement lifecycle. Piecemeal solutions that only address parts of the cycle can lead to bottlenecks and inefficiencies.
Configurable approval workflows are essential for efficient procurement operations. With customizable rules in place, orders and invoices can be automatically routed to the right people based on things like spending thresholds, budgets, and procurement policies. For example, requests up to a certain amount might only require a departmental approver, while larger amounts might require a controller sign-off.
Real-time visibility into budgets during the procurement process keeps spending in check. Leading solutions provide alerts and warnings when spending approaches budget limits. Some may even put hard stops in place to prevent budget overages. This level of tracking allows approvers and requesters to make smart purchasing choices based on available funds.
Robust reporting and analytics should provide clear insights into spending with granular details about where the dollars are going, trends over time, and breakdowns by vendors and categories. Complete visibility empowers data-driven decisions around suppliers, contracts, and spending.
Ad hoc reporting also enables procurement teams to quickly pull reports for different stakeholders as required.
Any eProcurement solution you choose must have comprehensive audit logs to support compliance with purchasing policies. Detailed audit trails track all activities across transaction lifecycles for transparency and accountability.
Automating three-way matching between purchase orders, receipts, and invoices is an important accounting control in eProcurement. Matching ensures amounts align before releasing payments, reducing discrepancies and exceptions.
Vendor management capabilities help track preferred suppliers, contracts, pricing/discounts, and more. Maintaining organized vendor data ultimately leads to better relationships and contract compliance. eProcurement systems can also help you identify poorly performing vendors so you can look for alternate sources.
E&I Cooperative Services offers a unique eProcurement model tailored specifically for education. As a member-owned organization, E&I leverages the collective purchasing power of thousands of schools and universities to deliver significant cost savings and process improvements.
Unlike traditional vendors, E&I acts as an extension of your procurement team. Member rebates help align incentives so E&I can strive to maximize savings for schools.
Key benefits include:
For any educational institution looking to elevate its procurement strategy, E&I delivers an ideal combination of purchasing power, marketplace access, and education community expertise. The member-owned model creates true alignment between E&I and its members, maximizing savings and
See the broad membership benefits available when you sign up with E&I Cooperative Services.