← Go back

Purchase-to-pay vs. Procure-to-pay


You are Here: Procurement Software >> Procure to pay software >> Purchase-to-pay vs. Procure-to-pay

There is no difference between the terms. Both refer to the P2P cycle that begins as a Purchase Requisition is raised and ends as the payment is dispatched to the supplier. Let’s go through an ideal Procure-to-pay process in its entirety:

The company uses a procure to pay software when they need to order something, and then a manager will fill in a Purchase Requisition and take it for approval. If approved, the procurement team will look into their list of consolidated vendors and send RFQs or RFPs to those vendors to enquire about relevant products or services and their prices. Once the procurement team finds a suitable solution, they will go for the most cost-effective and minimal-risk-offering option and open a Purchase Order to their chosen supplier after getting it approved.

As the vendor sends the goods and the invoice, the receiving officer will make a note of the quantity, type, and quality of items received in the form of a Goods Receipt Note [GRN]. The Accounts Payable personnel will then compare the PO, GRN, and the seller’s invoice, get the invoice approved and dispatch the payment.

Recommended Reading:

Procurement Software for Small Business in 2023 - How to Choose?
Top 5 procurement tools available in the market and which to choose
How to Build a Solid Procurement Strategy for 2023 [9 Steps]
11 Essential Procurement KPIs You Can’t Ignore
Top 4 Procure to Pay Solutions Your Business Needs
5 Most Important Procurement Solutions in 2023 You Need
The Vendor Management System (VMS) Buyer’s Guide 2023
The Ultimate Guide to a Truly Effective Procure-to-Pay Process

Comparison Blogs:

Sourcing vs Purchasing
Procurement vs. Purchasing
Direct vs Indirect Procurement
Purchase Order vs Invoice

People also ask