eProcurement is the series of methods through which the company can exercise efficient communication with the supplier by providing a direct link for communication and facilitating services such as emails, purchase orders, and vendor payments. Senior living communities, like all other businesses, require various goods and services. These needs are managed, monitored, and recorded with the help of eProcurement solutions.
The increase in need of eProcurement solutions is because of the adoption of technology through businesses in every aspect. eProcurement is readily accepted by both the buyers and the suppliers because of its potential to increase the productivity of the supply chain while also ensuring transparency throughout the process.
Procurement Requirements in Senior Living Communities
The products and services that are required by senior living communities are classified into a few categories.
- Administrative procurement
Various products are required by the administrative staff of the senior living communities. The procurement team tries to ensure that these products are acquired at the lowest possible cost to maintain the restrictions of the administrative budget. The eProcurement solutions can provide an extensive catalog for the following procurement requirements.
- Office supplies
- Cell phones
- Conference services
- Shipping solutions
- Car rentals
- Document shredding
- Dining procurement
One of the most extensively required procurement is aimed at dining and nutrition of patients in the senior living community. These products and services should not only be low in cost but also should be provided in high quality. The competitive prices available at eProcurement software can ease the process of decision-making while selecting the vendor for the following products
- Regional meat
- Organic options
- Locally sourced edibles
- Smallware and other equipment
- Specialty food
- Facilities procurement
Senior living communities also need to provide various facilities to their patients that can make their stay comfortable and relaxing. These products and services are required at a much lower frequency than the other requirements.
- Furniture and fixtures
- Housekeeping suppliers
- Capital equipment
- Environmental services
The Process of Procurement Followed in Senior Living Communities
Senior living communities require suitable medical technology, supplements, and medicines, along with other items of day-to-day use. When the need for such goods and services arises, the procurement team of the response team should follow the steps that are provided below to make sure that they assess the requirement properly while also ensuring that any need is resolved.
- Data gathering
The first step after the requirement has been realized is to assess the data. The data includes product literature, FDA approvals, MSDS documents, white papers, research papers, promotions, pricing plants, the contact information of the companies, etc. The process of data gathering requires extensive research to make sure that the best product is being procured at a suitable cost.
During the data gathering, a list of potential suppliers should also be created. These should be chosen based on various factors and aspects such as their credibility, quality of product and services, delivery time, etc. If the product or service being procured is technical and related to the medical needs of the patients, then the required expert or clinician should be referred to before finalizing the list of suppliers.
The quality of the product and services that are acquired after the completion of the procurement process cannot be compromised. This is because the ultimate aim of providing these services and products is the optimum patient outcome, satisfaction of the physician, and smooth and healthy functioning of the senior living community.
However, even a senior living community is a business that needs to boost the bottom line. Thus, the procurement team needs to ensure that the prices offered for the product or service should not only align with its value but also is agreeable to the bottom line of the senior living community. All alternative and competitive options should be checked and referred to make sure that the procured service or product has a value that can defend its price.
- Testing and trials
Based on the type of product being procured, the testing of the product will need to be done before it is integrated with the organization. The time is taken to acquire results after the testing also depends upon the product.
If such a product is acquired that needs testing, the contract should define that until the results are produced, the product will be considered in a pilot period. During this period, the physicians and caregivers can understand how and why the product is used while also determining whether the integration of such equipment is required for the functioning of the senior living community.
The impact of the services and products acquired should also be assessed during the testing period. If there are stakeholders involved, then they can also be familiarized with the process and working of the procured product during the testing period.
The final decision regarding the product or service that needs to be procured should not be based on the price of the product alone. As a senior living community is essentially a health facility, it needs to ensure that the product provides successful outcomes that can benefit the patients.
Thus, the procurement team should finalize the acquiring of the product based on the accuracy, quality, and impact of the equipment on the experience of the patients and response of the health experts and caregivers stationed in the senior living community.
Why Should eProcurement Solutions be Used in Senior Living Communities?
The process of procurement usually involves extensive communication between the buyer and supplier along with the management of payment orders, delivery receipts, etc. However, the process is much more complicated for senior living communities as they need to not only negotiate and find the product at the lowest price, they also need to make sure that the quality of the product is suitable for the patients and approved by the respective government authority.
eProcurement can not only automate most of the steps that are involved in the procurement process followed by senior living communities, but it also helps in cataloging the potential suppliers that are certified for the products and services that they offer.
eProcurement solutions are beneficial for both parties involved in the process of procurement. However, the senior living communities, can especially utilize the application to get the following benefits.
- Cost savings
eProcurement solutions can cause a measurable reduction in the overhead and paperwork that is needed to be maintained to ensure that all the records related to a particular procurement cycle are maintained. Not only does managing a paper-based process slow it down, but loss or damage of paperwork can also cause several discrepancies.
Using eProcurement solutions can help control the costs by ensuring that the procurement process can be completed quickly. It also provides a larger selection of suppliers and products, thereby providing the procurement team of senior living communities with access to several alternatives so that they can get the best quality of the product at a minimal price.
- Simplified procurement cycle
The eProcurement solutions centralize all the stages of the procurement process. Thus, the reports created for each order, purchase orders, payment invoices, requisitions, etc., are all managed by the application. It also ensures that both the parties agree to the terms and conditions that are mentioned in the contract by providing a smooth communication channel between the supplier and the community.
The eProcurement application provides electronic access to the procurement team of the senior living communities to assess the available products, services, and prices.
All the information regarding the purchase and delivery is recorded at a centralized system that is coordinated through a cloud-based system. Therefore, the complete procurement process becomes transparent and can be assessed by all the parties that are affected, such as stakeholders, shareholders, senior management, etc.
- Finance and accounting
The finance and accounting teams of the senior living communities will also directly benefit from the eProcurement software. Such solutions cause a measurable impact on the bottom line. With the costs that are saved through the employment of the eProcurement software, the revenue generated can be significantly improved. Better returns can be acquired through the integration of the eProcurement solution with the accounting system and enterprise resource planning (ERP).
- Operational benefits
eProcurement solutions help in increasing the overall efficiency of the procurement cycle with the help of lower procurement costs and limited unauthorized purchasing. As such, the impact of the software also benefits the operational functions of the senior living community. It helps in better audit trails, easier invoice matching, decreased inventory levels, etc. Thus, the time spent monitoring the operations and the expense of resources is also controlled through the integration of eProcurement software.
- Categorization of expenses
Organizations that monitor the functioning of the senior living communities create budgetary requirements based on two categories—capital expenditure and operational expenditure. Defining all the expenses occurring in a particular senior living community is necessary for report and contract creation. They also help define the limitations of the budget.
eProcurement solutions help distinguish all the expenses that occurred during a procurement cycle between the categories of capital and operational. It also creates specific budgets during the specified financial period, or as per the department, project, etc.
- Better supplier relationships
The transparency and accurate breakdown of costs that occurred from requisition to payment ensure that there is no miscommunication or misunderstanding between the supplier and the senior living community management. Along with that, the eProcurement solutions provide cloud-based spend management solutions that can further enhance the trust of suppliers in the business and vice versa.
Furthermore, with better communication and understanding of needs, the supplier can provide tailored products and services that are designed to specifically fit the requirements of the senior living community.