It is defined as the process by which resources are acquired which supports the current existence of the business.
EX OF INDIRECT PROCUREMENT
An organization even though having to depend on direct procurement would need the help of indirect procurement resources like office materials, supplies, systems,etc.
IMPACT’S OF INDIRECT PROCUREMENT ON BUSINESS
Spending on indirect procurement is done on a case-case basis. Lesser visibility is also done here and a lower share of investment is also done on resources. If the management of indirect spend’s is not done properly, bottom line will get hurt terribly.
INDIRECT PROCUREMENT OUTSOURCING
Consideration’s to be done for Indirect procurement outsourcing
- Improved price access
- Supplier intelligence access
- Visibility of spending improved
- Strategy activities more focussed
- Headcount reduced
What to outsource
- Procurement execution
- Invoice Auditing, reconciliation
- Spot buy
- Managing contracts
- Negotiation of strategic sourcing