Page 256 - Electronic Commerce

Business-to-Business Activities: Improving Efficiency and Reducing Costs

activities is called e-procurement. Similarly, the use of Internet technologies in sourcing
activities is called e-sourcing. Specialized Web-purchasing sites can be particularly useful
to procurement professionals responsible for sourcing. The business purchasing process is
usually much more complex than most consumer purchasing processes. Figure 5-1 shows
the steps in a typical business purchasing process.

Review vendor catalogs,
Identify Web pages, or 231
needs databases

Define Send requests for
requirements quotes (RFQs)

Approve Review quotes and
purchase select vendor

Create purchase order
Establish
credit with Send purchase order
vendor
to vendor
Arrange Check availability and
shipping confirm purchase order

Perform Fulfill and
inspections ship order

Inspect shipment and
process receiving
documents Check
receiving
documents
Transfer from Receiving against
Department to materials invoice and
storage purchase order Learning

Record Cengage
transaction in Process and
accounting send payment 2015
records ©

FIGURE 5-1 Steps in a typical business purchasing process
As you can see, the business purchasing process includes many steps. The business
purchasing process also requires a number of people to coordinate their individual
activities as part of the process. In large companies, the Procurement Department that
supervises the purchasing process might include hundreds of employees who supervise
the purchasing of materials, inventory for resale, supplies, and all of the other items that
the company needs to buy. The total dollar amount of the goods and services that a

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