eProcurement : Fashion or Structural Opportunity

Author(s) : Salvino A. Salvaggio & Michel Bauwens

Bibliographic Details : Brussels, Observatory of the DIgital Economy

Date of Publication : 2000

Executive Summary : eProcurement, which involves the rationalisation of ordering procedures using the Internet, is becoming an essential part of the armoury in the competitive battle because it has a drastic effect on the cost structure of an enterprise. The first introductory chapter provides some figures and examples to show its potential, as well as reviewing governmental, business-to-business and finally SME e-Procurement. The second chapter looks at the factors behind the boom in e-Procurement, illustrating its superiority over the old Electronic Data Interchange (EDI) system. This chapter highlights the changes, both external (with trading partners) and internal (back office, internal logistics), in which factors such as organisation and culture play no small part. The third chapter explains the four dominant deep market structure models, whilst the fourth chapter concentrates more explicitly on the selling and buying model. The document concludes with an analysis of the minimum conditions for success and underlines the importance of a critical mass of players. In this respect the European public authorities can act as a driving force in the process.

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