In most sectors, procurement refers to the process of sourcing products or services. In the construction industry specifically, procurement means labour and material buying – it’s the allocation of design and construction work and the choice of components that go into the building. It’s vital work, and involves multiple stakeholders, such as input from site and project managers, and can have a significant impact on the outcome of any construction project.
Procurement in construction not easy. Working with a complex and opaque supply chain, procurement professionals must source high quality products and services with a specific budget, and simultaneously, comply with regulatory guidelines. Accuracy, timeliness and quality of procurement is, therefore, important in the construction sector.
In fact, 87% of construction professionals believe that good procurement is synonymous with a successful project (The Chartered Institute of Building). And we at Wax Digital believe successful construction procurement relies on industry knowledge, experience, and the right technology.
Finding the right suppliers
Quality of suppliers is essential, as it’s all about getting the right person to do the job. However, due to the size of projects – especially construction firms that work with multiple sites the pool of suppliers that a construction company work with can be massive, meaning that it can be challenging to deal with quality control.
With the right technology, such as a best-of-breed of supplier information management system, you can put the onus onto the suppliers by allowing them to self-serve everything – from registration to account maintenance. So, instead of using your valuable time to manage your suppliers, you can ensure that all your supplier information in your database is already accurate and up to date.
And because suppliers have to submit and renew proof of mandatory certifications, you will only trade with suppliers that are up to your standard.
Some software, such as web3 for construction, is integrated with pre-qualification databases, such as Archilles and ConstructionLine, so you can ensure all activities meet your compliance and project requirements.
Procurement professionals need the knowledge and experience to source the best quality products and services available, to procure on schedule, and to stay within budget. Because of the amount of labour and material that’s involved in construction projects, volume-leveraged pricing is extremely important in construction procurement.
With a sourcing platform, you can reduce cycle time and cut evaluation time by up to 85%, allowing you to align your sourcing activities with a project schedule. And thanks to a digital, transparent sourcing process, you can outreach much further and establish a large network of providers. An eSourcing system can help with the products and service evaluation process, and in some cases, the built in geo-location functionality allows you to factor in any logistic consideration in transporting materials to the project site too.
Wax Digital has over 10 years’ experience in helping construction organisations to achieve procurement excellence. Our fully integrated web3 for construction solution has helped many clients such as Skanska, Barratt and Murphy to manage supplier risk and performance, and gain visibility and control across the large and complex supply chain.
Download our web3 for construction solution guide to find out more.