How can construction companies improve procurement efficiency through software?

Mondo Workplace Updated on 2024-02-28

The continuous development of China's society has increased the economic benefits of the construction industry, met the basic living needs of the people in China, and also led to the improvement of labor productivity and promoted the process of China's socialist modernization. With the continuous development of economy and society and the maturity of modern technology, China's construction industry has gradually transitioned from a labor-intensive industry to a capital-intensive industry, and the transformation and upgrading of construction enterprises has been further accelerated. Due to the repeated "new crown epidemic", the total output value of China's construction industry in 2022 will be 3119798.4 billion yuan, a year-on-year increase of 642%, the growth rate declined; The total output value of the construction industry in the first half of 2023 will be 132,2607.4 billion yuan. And because most of the building materials enterprises are still using the traditional procurement method, the traditional mode of the industry has accumulated some outstanding problems for a long time, mainly in the following aspects:

1. The level of information integration is low, and the collaboration link is not smooth

The history of the use of information systems in construction enterprises is not short, it can be said that from the emergence of information systems, from large construction enterprises to small and medium-sized construction enterprises, have begun to popularize information software systems, from finance, taxation, personnel to ERP, generalized information system software in the building materials industry is still very popular. However, the extensive industrial model and management system in the past have led to insufficient attention to the information flow in the building materials industry, only paying attention to the storage and display of a single information, and lacking liquidity considerations and applications.

2. Procurement is not transparent and the bargaining power is weak

Construction enterprises often have large quantities of procurement needs, in the procurement process must control the cost elements, but due to the asymmetry of supply and demand information exchange, procurement is completely opaque for the purchaser, lack of understanding of the market, resulting in the procurement of the demand side of the bargaining power is very weak, in the transaction game is passive.

3. The pressure of capital occupation is high, the turnover is slow, and the capital cost is high

In the context of urbanization and a large amount of infrastructure investment, the construction enterprises themselves have a large number of capital needs, for the operation of the project, and the procurement of building materials is often a large number of large quantities, a variety of rigid needs of enterprises, no materials, no personnel will lead to project stagnation, but occupy a large number of enterprise funds to invest in procurement, and will make the capital turnover pressure of enterprises increase sharply, procurement brings slow capital turnover, high capital cost and other problems, is the pain of enterprises.

4. The payment model is complex and needs to be unified

The payment mode of procurement in the construction industry is relatively complex, the payment scheme and payment conditions on the contract are varied, and the payment carriers are cash, checks, acceptance bills, etc., and the industry urgently needs to solve the problem of unification of payment methods. In addition, the existing online payment methods have problems such as payment limit and lack of credit guarantee, which cannot well meet the needs of construction enterprises.

5. Low procurement efficiency and long decision-making process

In the process of building materials procurement, some buyers will encounter the lack of detailed procurement planning in the face of huge procurement volumes, and some procurement personnel will lose the procurement list because the procurement list is too complicated, which will lead to low procurement efficiency, secondly, the purchase quantity is insufficient, the first business is unstable, etc., will cause the procurement cost and material quality is difficult to control the consequences, and then affect the construction progress, for the entire project to drag back.

According to the analysis of the appeal, we can find that the construction industry is still in an extensive stage, and it is urgent to change it, improve the efficiency of industry procurement, and further promote the supply-side structural reform of the industry. In this regard, Yiqi Engineering Cloud, which has been deeply engaged in the field of full-chain digital operation services for many years, has created a procurement solution for building materials based on the specific situation of the construction industry, and enterprises can refer to the following aspects for change.

1. Establish a strong market awareness

The procurement work of construction enterprises needs to pay attention to market dynamics from time to time, fully grasp the market of building materials and establish a strong market awareness. In the intricate material market, the first frequent changes have also had a great impact on the procurement management work, the ability of construction enterprise procurement personnel to obtain market information is very important, enhance the market perception of procurement personnel, and establish a good market awareness is imperative.

2. Choose a suitable procurement model

Choosing a procurement model suitable for the actual situation of construction is very important for the management of building materials. Procurement personnel in the procurement of building materials should be carried out in accordance with the requirements of material management policies and national policies and regulations, the management of relevant departments are well in mind, and in strict accordance with its provisions for procurement.

3. Based on the professional procurement management system, improve the overall efficiency

There are many loopholes in manual management of project procurement, which can easily lead to various problems. With the help of the Yiqi engineering cloud management system, the management of the entire procurement process of construction enterprises can be more standardized and clear, skip middlemen and wholesalers, make the difference without middlemen, reduce the best at the same time, improve procurement efficiency, ensure the quality of building materials, help construction enterprises and dealers to transform and upgrade, meet the needs of upstream and downstream, and open up a new pattern of industry ecology that can be absorbed, transformed and valued.

Procurement costs and budgets

Only by strictly controlling and managing procurement costs can we gain a strategic competitive advantage. With the help of the procurement management system, the procurement cost based on the bill of materials can be automatically calculated, the procurement budget can be automatically verified, and the correct budget can be submitted to the superior for approval.

Sourcing management

In order to achieve strategic procurement, the system supports sourcing management, which is based on the need for price comparison. Through the sourcing management module, a set of standard sourcing system and contract management system are established. Through the standardization of inquiry and price comparison, negotiation process and contract management, the purpose of high integration of informatization can be achieved, which can quickly adapt to market changes, improve procurement transparency, save procurement costs and reduce procurement risks.

Increased productivity

Traditional procurement is time-consuming because human involvement is required at every step of the process. With the e-procurement process of the procurement management system, construction companies can easily identify problems in the workflow and thus establish a better procurement process. When everyone saves time, productivity can be increased in other areas of the business.

Manage inventory levels in real-time

A procurement management system provides a comprehensive review of orders placed, reducing the chance of duplicate orders, order errors, or order specification errors, and a controlled inventory maintenance system can even reduce stockouts.

Procurement settlement management

Provide material procurement settlement management, matching bills and business data; Settlement rule maintenance, establish the relationship between business data and financial data; Convert business data into financial data according to settlement rules, and realize integration with financial systems without financial management systems. It mainly includes the settlement of various expenses such as payment, freight, and miscellaneous expenses.

Summary

Technology is the engine of the company's development, in the "Internet +" highly popular today, the focus of the traditional industry has long turned to the high-speed train of information system construction, many leading construction enterprises have realized the electronic, informatization and sharing of the industry product procurement process through the construction of procurement management system, helping both sides to trade quickly, and with advanced operation concepts, professional product planning, and open development vision, integrate the upstream and downstream of the industry chain, forming an ecological closed loop of the industry. Long-term and past to ensure the healthy and stable development of the enterprise.

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