KPIs to Track for Successful eProcurement in the Hospitality Industry

By thoroughly tracking and analysing these key performance indicators for eProcurement, hotels who value business intelligence can make data-driven decisions to streamline their procurement processes and achieve significant cost savings!

At FutureLog, we offer comprehensive eProcurement solutions to help you not only track these KPIs, but also leverage real-time data to optimise your operation and drive success.

Here’s everything you need to know…

eProcurement KPIs in hospitality are quantifiable metrics that measure the efficiency, effectiveness, and overall performance of your procurement processes.

These KPIs provide valuable insights into various aspects of procurement, such as cost savings, supplier performance, inventory management, and process efficiency.

In monitoring these metrics, you can identify areas where improvements can be made, track progress towards your procurement goals, and ensure alignment with your overall business objectives.

• Cost Savings: Track the cost savings achieved through eProcurement initiatives, such as negotiated discounts, reduced processing costs, and optimised inventory levels.
• Procurement Cycle Time: Measure the time it takes to complete a procurement cycle, from requisition to payment, to identify bottlenecks and streamline processes.
• Supplier Performance: Evaluate supplier performance based on on-time delivery, quality of goods, and adherence to contract terms.
• Inventory Turnover: Monitor the rate at which inventory is sold and replenished to optimise stock levels and minimise holding costs.
• Order Accuracy: Track the accuracy of orders placed through the eProcurement system to reduce errors and prevent costly returns.
• Contract Compliance: Measure the percentage of purchases made under contract to ensure compliance with negotiated terms and pricing.
• User Adoption: Monitor the adoption rate of the eProcurement system among staff to ensure effective utilisation and maximise your ROI.

While the specific KPIs you track may vary depending on your hotel's needs and objectives, some essential metrics include:

• Spend Under Management: The percentage of total spend managed through the eProcurement system.
• Procure-to-Pay Cycle Time: The time taken to complete the entire procure-to-pay process, from requisition to payment.
• Supplier On-Time Delivery: The percentage of orders delivered on time by suppliers.
• Inventory Days on Hand: The average number of days that certain inventory is held before being used or sold.
• Cost per Invoice: The average cost of processing an invoice.

eProcurement KPIs are essential tools for measuring and improving the efficiency of your hospitality procurement processes. When tracking these metrics, you will gain valuable insights into your operations, identify cost-saving opportunities, and enhance overall performance.