Automated Purchasing in Sage ACCPAC ERP

By: | Category: ERP

Automating And Integrating The Purchasing Process Can Result In Significant Cost Savings

In this difficult business environment, smart managers are seeking ways to reduce expenses. Here is a powerful statistic: if a business operates on 10 percent profit margins, a reduction in expenses of just 5 percent has the same impact on the bottom-line as 50 percent higher sales. Is your company paying too much for purchased items? Effective purchasing processes can play a critical role in cost control and its contribution to the bottom-line cannot be overstated. Yet this vital function is often overlooked in the automation process. In this article we discuss the signs of inefficient purchasing processes and how the fully automated purchasing system in Sage ERP Accpac can help.

Signs Of Inefficient Purchasing
How efficient are your purchasing processes? The following are signs that you are missing potential savings that can be achieved with an integrated, automated process:

  • Individual departments each make small orders of items, such as office supplies, with various vendors.
  • Paper forms are used to request purchases and gather approvals. In routing, requests are often delayed or misplaced.
  • After a requestor fills out paper forms or spreadsheets for purchase approval, other staff must then key in the information to update the General Ledger and Accounts Payable systems.
  • The formal purchasing process is only required for big ticket items. Smaller purchases are made on an individual haphazard basis.
  • The purchasing process is lengthy, and results in loss of productivity because items are not available when needed.

The Purchase Orders Module
The key to simplifying purchasing is integration. Purchase Orders is a comprehensive, automated purchasing system that is fully integrated with your Sage ERP Accpac system enabling you to:

  • Manage suppliers better
  • Negotiate lower prices
  • Establish effective internal controls
  • Maintain optimal inventory levels
  • Maximize purchasing power
  • Reduce time in the purchase cycle
  • Analyze spending data

Negotiate Better Prices
The first benefit of centralizing purchasing with the Purchase Orders module is the ability to set up standard supplier lists and develop relationships with preferred vendors. You can negotiate better prices for high volume supplies or inventory items. This module allows you to set up contract pricing for each vendor to track special pricing agreements. You also can create message templates to speed the process of sending purchase orders and returns to vendors by e-mail.

Maintain Optimal Inventory Levels
To achieve optimal inventory you must have the right products on hand when needed, while avoiding overstocking to minimize carrying costs. The Purchase Orders module can be configured to automatically produce purchase orders based on Inventory Control reorders or from Order Entry backlogs. It also allows you to smoothly drop-ship items directly to the customer from your preferred vendors. Integrating the inventory, purchasing, and order entry processes helps you maintain the delicate supply/demand balance. Purchases can be made quickly based on real-time order information. Fresh inventory can be ordered just-in-time, so that you maintain adequate stock while avoiding overstocking items and the associated storage costs.

Flexibility In Purchase Order Creation and Receiving
Features in the Purchase Orders module make creating purchase orders fast and easy. You automatically can produce purchase orders from Inventory Control reorder information or from Order Entry back orders. Templates can be set up for frequently ordered items to improve productivity. A single purchase order can be created from multiple requisitions, to give you more purchasing power with your suppliers. Various purchase order types are supported. You can create standing and blanket purchase orders, and you even can set up future purchase orders. Choose from seven costing methods for the default item cost that prints on purchase orders. The costing methods include: Most Recent Cost, Standard Cost, Average Cost, Vendor Cost, Last Unit Cost, and two alternate amounts for added flexibility.

Productivity gains are realized during the PO receiving process as well. You can combine multiple purchase orders on a single receipt and multiple receipts on a single invoice. You can process adjustments to quantities, item costs, and additional costs directly on the receipt, rather than as separate inventory adjustments, and allocate additional charges manually or by quantity, weight, or cost. Once goods are received, the Shippable Backorder report helps identify the customer orders that can be shipped. Leave purchase orders open indefinitely until all items are received, or cancel any remaining ordered items at any time.

Analyze Spending Patterns
Another important benefit of an integrated purchasing system is the insight it provides into your companyís spending patterns. You can review current status and spot patterns using built-in purchasing reports such as Purchase History, Transaction and Audit Lists, Purchase Statistics, and Aging Reports. The Purchase Orders module information also will flow into your business intelligence solution so that you can analyze your spending using graphical views.

Purchase Globally With Ease
Is your company sourcing materials, parts, or finished goods in other countries? If so, the Purchase Orders module can make your day-to-day job much easier. Used along with the Multi-Currency module you can create POs in multiple currencies and translate them back into your home currency before posting to Accounts Payable and General Ledger. The module also allows you to report on purchases across currencies by translating them into a single currency for analysis.

While it adds efficiency, you do not need to use the Inventory Control module to take advantage of automated purchasing with the Purchase Orders module.

As the economy recovers, your integrated purchasing system will help your organization continue to control costs and improve purchasing power. If you can purchase more goods and services than your competitors do for the same money, your company will gain an advantage that directly impacts the bottom-line. Give us a call to learn more about the Sage ERP Accpac Purchase Orders module.