The dependence of fast growing construction industry on its suppliers and sub-contractors is increasing. The efficiency of the supply chain is vital to the overall efficiency of the organization.
Challenges
The key challenges include:
- Providing a platform for domestic as well as international suppliers to approach the organization
- Communication between suppliers and organizations involves many stakeholders and different communication channels, resulting in a loss of communication
- Constant tracking and update of supplier information
- Managing the documentation with suppliers
- Need for transparency between organizations and their suppliers/ sub-contractors for a mature relationship
Solutions
To address the challenges, the supplier portal can be an effective tool that enables collaboration between suppliers, sub-contractors and transporters by providing customized, partner-specific access to buyers’ content, services and applications through the internet. It is a centralized portal which automates a large part of the procurement process. Some of the features are as follows:
- The platform for suppliers willing to associate with the organization, where they can furnish their details.
- The procurement process can be digitized, right from listing RFQ/ RFP on the portal to suppliers accessing the same and submitting their bids online. e-tendering can also take place using the supplier portal.
- The finalized details along with prices, terms and conditions can be integrated with the organization’s ERP system for generating the purchase order/ work order and getting it authorized.
- Communications such as shipping details by the supplier, goods receipt notes by the organization, taxation data and certificates can be exchanged electronically
- The invoice processing can be automated by integrating the supplier portal with ERP
- A complete digital record of the history of the supplier can be maintained which can be used for a more scientific vendor evaluation. Various MIS reports can also be made available for the organization as well as for the suppliers.
- Security of data can be maintained by defining levels of access/ facilities that they want to provide to each class of suppliers.
Benefits For construction organization
- The platform for strengthening vendor the base
- Facilitate vendor development process
- Reduced risk of delays in supply
- Improved order-fill rates
- Reduced inventory levels
- Reduced downtime & overtime
- Improved efficiency of the buyers and their support staff
Benefits for supplier
- Faster order-to-cash cycle
- Insights into own performance
- Better capacity utilization
- Increased inventory turns
- Increased order-fill rates