Procurement

XBuddy Procurement manages the full procure-to-pay cycle — from purchase request to vendor selection, purchase order to goods receipt — with approval workflows at every stage.

Key Features

• Purchase request creation and approval workflow
• Vendor management with contact details and performance history
• Request for Quotation (RFQ) with multi-vendor comparison
• Purchase order creation and PDF generation
• Goods receiving and three-way matching (PO, receipt, bill)
• Vendor performance scoring based on delivery and quality
• Integration with Inventory (stock updates on receipt) and Finance (supplier bills)

Getting Started

1. Add your vendors with contact details and payment terms
2. Create a purchase request and submit it for approval
3. Convert the approved request to a Purchase Order
4. Send the PO to your vendor and record the goods receipt
5. Match the supplier bill to the PO and receipt for payment

Workflows & Processes

Purchase Request to Payment (P2P) Cycle

1. Create PR — Requestor submits purchase request with item, quantity, business justification, cost center
2. Budget check — System verifies cost center has sufficient budget; flags overages for approval
3. Approval chain — Manager approves (routine) or Finance Director (over-limit); request → Approved status
4. Create PO — Procurement creates formal PO from approved PR; matches vendor and payment terms
5. Send to vendor — PO sent via email or EDI; tracked for acknowledgment
6. Receive goods — Receiving dock scans items; system records Goods Receipt (GR)
7. Three-way match — System matches PO ↔ GR ↔ Vendor Invoice; flags discrepancies
8. Approve bill & pay — Finance approves matched invoice; payment released per vendor terms (Net 30, etc.)

Vendor Evaluation & RFQ Process

1. Create RFQ — Procurement creates Request for Quotation; specifies items, quantities, delivery terms, specifications
2. Send to shortlist — RFQ sent to 3–5 qualified vendors; sets response deadline (e.g., 7 days)
3. Collect quotes — Vendors respond with pricing, lead time, payment terms, technical specs
4. Compare & score — Procurement scores vendors on: price (40%), delivery (30%), quality (20%), terms (10%)
5. Select vendor — Top-scored vendor selected; RFQ converts to draft PO
6. Negotiate if needed — Optional back-and-forth to refine terms; finalize and issue PO

Integration Points

• Inventory Module — Goods Receipt updates stock levels automatically; inventory reserved against PO
• Finance Module — Supplier invoices created and three-way matched with PO and receipt; payment triggered automatically
• Accounting Module — Matched invoices post as accounts payable (AP) liabilities; COGS recorded on goods receipt
• Manufacturing Module — Material PRs auto-generated from BoM when production orders created; Procurement converts to POs
• Budget Module — PR budget check validates cost center allocation before approval

FAQ

Q: Can I cancel a PO after it has been sent to the vendor?
A: Yes, but only if goods haven’t been received. Cancelling posts a credit memo or debit note for any advance payments made.

Q: How do I handle partial goods receipts?
A: Record the partial GR in the system. Remaining items stay “on order”; a follow-up GR can be created when the rest arrives.

Q: What if the vendor invoice amount doesn’t match the PO?
A: System flags the mismatch. Finance can approve the variance (if within policy tolerance, e.g., ±2%) or reject for vendor correction.

Q: How do I track vendor performance over time?
A: Procurement dashboards show: on-time delivery %, quality pass %, and price consistency. Poor performers are flagged for review or removal from approved vendor list.