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Everything You Need to Know About Automation in Your Procure to Pay Cycle

January 19, 2022

Everything You Need to Know About Automation in Your Procure to Pay Cycle

If you want to know about the Procure to Pay (P2P) process and how it affects the way you buy and pay for goods, you have come to the right place. In this article, we are going to discuss with you the role of a procure-to-pay solution in the P2P cycle. Procure-to-pay, also known as purchase-to-pay is one of the most fundamental business processes focussed on how you choose goods or services that you want to buy, get approval to make that purchase, receive the goods/services and then pay for the invoice.

In this article, we are going to discuss with you all the steps within the procure to pay process and where a P2P solution can support the process. Let’s begin with the basics. 

what is the procure to pay process? 

Procure to pay refers to the process that involves the “requisitioning, purchasing, receiving, paying for and accounting for goods as well as services”. This process however informal it may be is used in every single business across the world and is essential to running a business. How efficient that process is, is a bigger question. We will take a look at the steps involved and where efficiencies – through using a procure to pay solution can be achieved.

Step 1 – Raising a requisition

The procure-to-pay process begins with the need to purchase a good or service. This starts with a purchase requisition, which is a documented need for that good or service including what it is, how much it costs and when they are needed. Requisitions can be made in a number of different ways, you may have an excel spreadsheet that gets completed, you may enter the details directly into your ERP system or use a fit-for-purpose P2P platform. Having a centralized P2P platform allows companies to streamline this part of the process as the requisition can be made electronically.

Step 2 – Selection of suppliers and vendors

Once you have your requisition you then need to decide who you want to purchase the goods or suppliers from. Supplier selection can take many forms, from ordering from the first supplier you find, to requesting for quotes from a few suppliers through to engaging with suppliers that you have already negotiated a contract with. Utilising a procure to pay solution can make the process of selecting a supplier far more efficient through forcing users to make purchases under existing contracts or making request for quotes far easier.

Step 3 – Requisition Approval

With your requisition completed the next step in the process is to get approval to spend that amount of money, for those goods or services with that supplier. The process behind this could be very manual like signing a requisition or approving via email all the way through to digital approvals through a procure to pay solution. Automating this part of the process can ensure that corporate purchases are always digitally tracked and are done in accordance with your policies and procedures.

Step 4 – Create and Issue a Purchase Order

Once the approval is received, a purchase order (PO) is created to formally request goods or services from the supplier. Generally speaking, In contrast with an invoice which is sent by the supplier, POs come from buyers and outlines quantities of product being requested along with price specifications and other special requirements set out when placing orders or making purchases at various points throughout the transaction process. This process can be very manual as well from ordering over the phone, fax, email or mail there through to digital transmission of the purchase order directly to the supplier via a procure to pay solution, you can be sure that the order has been received and will be fulfilled.

Step 5 – Receipt of Goods/Services

The supplier fulfils the purchase order, delivering the goods or service to the buyer who in turn confirms receipt of the goods or services. Utilising a procure to pay solution, suppliers can also provide advanced shipping notices (ASN) to the buyers to advise when to expect the goods or services which can help with resource planning for deliveries and utilising the goods or services. Additionally the receipt process is very important in modern procure to pay solutions to drive the matching of invoices to purchase orders as part of a 3 way match (Purchase order to invoice to goods receipt).

Step 6 – Invoice from the supplier

The supplier submits their invoice to the buyer and expects payment, invoices can be delivered in a range of ways from very manual data entry formats like post or email to digital delivery like Peppol e-invoices and other electronic formats. Businesses wanting to automate the receipt and data capture of invoice data require a modern and flexible procure to pay solution.

Step 7 – Invoice Processing, Approval and Payment

The final step in the procure-to-pay cycle is the buyer paying the invoice through their accounts payable teams.  Utilising modern procure to pay solutions can drive huge efficiencies in the invoice validation and approval process ensuring that only appropriate invoices are paid after being matched to a purchase orders. Modern procure to pay solutions are highly effective at mitigating the risk of invoice fraud in a business.

Valtatech provides procure to pay solutions that simplifies the process of buying, managing and paying for goods. Our solutions integrate all phases of the process into one platform driving efficiency, automation and ultimately cost savings.


The P2P process can be complex; hence, you need an end-to-end solution like Valtatech’s Procure to Pay Solution which facilitates automation and integration between each step in this process: prequalifying suppliers, getting quotes/bids from potential suppliers, automated order management using purchase orders generated by the various business units throughout your organisation after shortlisting best offers and then automating the accounts payable process. Want to speak to an expert about this? Book a free consultation with one of our experts at Valtatech today!

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