Subscribe to the blog

Get the latest Procurement insights from our experts

The Xoomworks Guide to SAP Ariba Spot Buy

by | October 26, 2018

In an ideal scenario all of a company’s purchases are attentively planned and the business is always aware of its purchasing needs before there is an actual gap. But of course, that doesn’t actually happen in the real world, at least not 100% of the time. 

The background story

While businesses plan purchases for the categories that are vital to their activities, unplanned purchases always tend to surface. These are often time sensitive and critical purchases that every company makes at some point or another.

Things can get difficult and risky with these types of purchases and an un-expensive purchase could well turn into an expensive one. The problem is that companies can’t afford to have a Category Manager run strategic sourcing events for this type of spend as it is time-critical and generally low value.

Businesses also rely on e-procurement apps to manage spend, suppliers and catalogues. Even though companies have hundreds of catalogues to choose from, often at times these are incomplete or don’t offer the best prices. Building and maintaining comprehensive B2B catalogues can be quite expensive, time consuming and not worth doing for some categories.

Companies need a solution through which they can easily make these types of purchases in a way that is compliant with their procurement processes and policies. They also need a way to reduce the risk of employees doing things on their own, in a non-compliant manner.

How does SAP Ariba Spot Buy work?

Online marketplaces can be a solution to the problem. However, organisations must establish policies to manage the use of these marketplaces and ensure compliance with their own internal processes.

SAP Ariba have developed an online B2B marketplace to help with this. Spot Buy makes it easy for the buyers to find what they need from an on-demand catalogue containing millions of live listings across business categories. Convenient search and filters help users find and buy approved items with competitive price and delivery options.

With SAP Ariba Spot Buy companies can have the items they need to run their business while reducing vendor and catalogue management costs. Here’s the 3-step process explained below:

  • Find: When an item can’t be found in the company catalog, users search the SAP Ariba Spot Buy catalogue, filtering results by category, brand, and price.
  • Approve: Configurable business rules and spot buy-specific workflow enforce corporate policies.
  • Buy: Approved purchase requisitions trigger checkout, secure payment, and shipment of goods.

Does your company need SAP Ariba Spot Buy?

If you can’t relate to the any of the issues we talked about in the background story, then SAP Ariba Spot Buy is probably not for you.

There is always space for improvement and professional buyers need to make sure they meet quality, time and price requirements in today’s fast paced business environment. There is always space for better spend visibility and control over non-sourced purchases. Having in place a tool that can facilitate this process, better fulfils buying demands and improves user convenience.

There is some benefit to this for suppliers as well, as SAP Ariba Spot Buy can act as a sales channel through which suppliers can boost sales to existing customers and generate new sales by offering their goods when and where buyers need them.

One of the best definitions for what Spot Buy does was given by Kurt Albertson, Associate Principal Advisor at The Hackett Group, in the “Spot Buy Software: A Modern Approach to Managing Tail Spend”: “Spot buying software solutions offer a convenient way to search for suppliers and shop for goods in external B2B catalogs and procurement organizations can use them to increase visibility and control over a large category of spend that has until now been very difficult to manage.”

Want to learn more about how to get the most out of your SAP Ariba cloud solution? Leave us a message at [email protected].