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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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