Source-to-pay solutions, generally known as s2p, are the end-to-end procedure and levels that companies under go-to source, order, and pay for products or services.
A complete Source to pay process consists and covers all procure-to-pay levels. It also comprises the strategic sourcing and selection of vendors at the frontends of the procure-to-pay procedure. It gives 100% spend clarity from the point of retailer onboarding to selection to pay. Or you can say a Source to Pay (S2P) solution, brings sightlines and control over the whole procurement lifecycle in an easy to use package, assisting the user to how to save on spending, increasing company-wide compliance and making the procurement processes more effective and efficient.
Some details of the source to pay (s2p) process:
The s2p solution covers the complete procurement process. It includes all elements starting from source to contract to purchase-to-pay (p2p). These are the certain steps, which may include:
- Analyze the product/service requirement
- Start sourcing and choosing the suppliers
- Do necessary negotiation and try to manage the contracts
- Creating or developing a purchase order
- Perform and complete the budget authorization process
- Acquire the receipt of delivery
- Finally, Invoicing the transaction
To provide complete information about source to pay (s2p) solutions, we have further explained some of its key features:
A full source-to-pay (s2p) automation solution can provide a depth in the functionality across the whole process of sourcing, purchasing, and accounts payable; these may include:
- Strategic sourcing and Contract Lifecycle Management (CLM) assist and support the retailer relationships in all the levels of negotiation.
- Electronic procurement (E-procurement) supports the generation of purchase requisition and approval to help order products and services.
- Potential to create Purchase Orders (POs) and transfer them to suppliers.
- Receipt Invoicing and matching/authenticating Purchase Orders with invoices and workflows by invoice deviation handling and non-Purchase order-based invoices.
- Management of Payment process and its reconciliation, early payment discounts, and working capital improvement.
- Supplier information management (SIM) to get to know the suppliers’ history and bring stability in the process to minimize the risks in the supply chain.
Key benefits of the source to pay solutions:
Now here we have explained some of the important benefits of s2p solutions:
1. 100 percent Spend visibility analysis:
The major benefit of the source-to-pay automation solutions is assembling and aggregating financial data from all operations on an exclusive platform. Source to pay solution can acquire almost 100 percent of the data to empower strategic decision-making for all the departments.
When the user onboard all his suppliers, acquire all invoices from direct/indirect spending and attain user’s adoption on electronic procurement solution, then a user can get 100% visibility in all the entity’s spend, which enables a user to:
- Make him understand that how money is being used and reduce the extravagant spending
- Get exact-size of the supply base and volume discounts
- Make sure timely and accurate payments and also reliably forecast cash flows
- Source strategic associations and innovation
2. Mitigate Supply Chain Risk:
A user should use s2p to get the info of its supplier base quickly. Experiencing Supplier’s trading or regional challenges which need special focus, a perfect s2p usage bring visibility to the whole s2p cycle, assisting in identifying if there is any need to provide flexibility in supplier association or payments (I.e., early payment or volume-based discounts)
By getting rid of the paper-based mechanism and manual processes, a user has a complete electronic audit trail (e-audit trail), meaning a user knows exactly whom he is doing his business with every time. Automating the source-to-pay procedure ensures users have more time to concentrate on other key activities instead of tedious manual work. A user can further use options like Supplier Relationship Management (SRM) to scrutinize supplier history, authenticate supplier data and enhance Supplier’s transparency.
3. Upgrade productivity stages:
Source-to-pay automation solutions diminish monotonous, manual activities that slow down processes, run up charges, and make the business burdensome.
Once a user’s workflows are automated at optimal efficiency and speed, a user can expect to:
- Drastically diminishes cycle times and gives the payment to the suppliers faster.
- Avoid late charges, misplaced invoices, repetitive payments, and other same problems.
- Enhance discounts savings and release working capital.