Procure to Pay (P2P) Business Process Steps

In this blog, we will take a quick look at the steps and activities involved in the Procure to Pay (P2P) business process.

A procure-to-pay (P2P) business process is a series of steps and activities that are involved in purchasing goods and services and paying for them. The P2P process typically includes the following steps:

  1. Identify the need for goods or services: This might involve conducting a needs assessment, analyzing business requirements, or identifying opportunities for cost savings.
  2. Develop a procurement plan: Once the need for goods or services has been identified, the next step is to develop a procurement plan. This might involve identifying potential suppliers, evaluating their capabilities, and determining the best procurement approach.
  3. Issue a request for proposal (RFP): After the procurement plan has been developed, the next step is to issue a request for proposal (RFP) to potential suppliers. The RFP typically includes detailed information about the goods or services being requested and the criteria that will be used to evaluate proposals from suppliers.
  4. Evaluate proposals and select a supplier: After proposals have been received from suppliers, the next step is to evaluate them and select a supplier. This might involve conducting interviews, reviewing references, and comparing proposals to determine the best supplier based on the criteria outlined in the RFP.
  5. Place the order: Once a supplier has been selected, the next step is to place the order. This typically involves negotiating the terms and conditions of the purchase, including the price, delivery schedule, and payment terms.
  6. Receive and inspect the goods or services: After the order has been placed, the next step is to receive and inspect the goods or services. This might involve coordinating with the supplier to ensure that the goods or services are delivered on time and as specified in the purchase order.
  7. Process the invoice: After the goods or services have been received, the next step is to process the invoice. This might involve verifying that the invoice matches the purchase order, reconciling any discrepancies, and obtaining approval for payment.
  8. Make the payment: The final step in the P2P process is to make the payment. This might involve issuing a check, transferring funds electronically, or using a procurement card.

Overall, the procure-to-pay (P2P) process involves a series of steps and activities in purchasing goods and services and paying for them.

Published by

Aroon Raj

A blog about SAP

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