You can use this business process to process all your requirements and optimize your source of supply for each individual item. You can identify saving opportunities and evaluate suppliers in their ability to provide materials and services at low cost, high quality, and according to schedule.

Once you have determined the best source of supply (e.g. via RFXs or auctions) for your requirements, you can collaborate in project teams both internally and with your suppliers, and establish on-going relationships based, for example, on contracts and global outline agreements.

mySAP SRM offers a lean yet powerful tool within mySAP BI to consolidate and harmonize master data (vendors, products, product categories) for reporting purposes. This local master data alignment allows you to identify and group duplicate vendors or products coming from the various procurement systems. In the spend analysis reporting, such a group will appear only as one consolidated entry instead of multiple entries (that is, one for each original item).

A huge variety of analyses are available, ranging from "Top Suppliers", "Number of suppliers per product category" to "Purchasing Volume per quarter" and many more.

This business process is used to host and manage online reverse auctions in a real-time environment. Purchasing professionals can automatically generate an auction, populate the interface with all information needed to start the bidding process, and notify all qualified suppliers selected to participate in the event. They can also create auctions directly from bid invitations.

The process includes several options for populating auctions and allows existing auctions to be used as templates for new ones. It tracks price movement and activity volume over time, highlights best bids on a per-supplier basis, and provides full bid history for each supplier, including real-time updates as new bids are submitted. Participants can automatically translate bid information into charts and use instant messaging to communicate with other participants.

You can use this business process to invite suppliers to submit bids in response to a bid invitation.

Since negotiation is a critical step in the sourcing process, purchasing companies can use bid invitations to invite qualified suppliers to offer materials or services according to requirements. Typically, the supplier?s offer is final and binding and there is no opportunity for lowering bids. This makes bid invitations slightly less competitive than reverse auctions.

This business process supports and streamlines bid invitation processes, enabling users to create bid invitations out of existing contracts and requisitions. It also provides the tools needed to quickly convert received bids into purchase orders or contracts. This accelerates the bid invitation process and vastly increases the productivity of purchasing professionals.

You can use this process either to

• Negotiate a new contract using a special transaction type in SAP Bidding Engine
• Renew an existing contract that has been released already.

In this case it is triggered in the contract application of SAP Enterprise Buyer and moved to SAP Bidding Engine. The supplier then submits new contract details or updates existing ones, such as target value or conditions.

In the purchasing component, a contract is a type of outline purchase agreement against which release orders (releases) can be issued for agreed materials or services as and when required during a certain overall time-frame.

The source list is used in the administration of sources of supply. It specifies the allowed (and disallowed) sources of a material for a certain plant within a predefined period.