Procure to Pay Summary

Procure to pay consist of two different process, there are procurement and payment process. But these process are integrated. Procurement, as we know, is a process of goods or services purchase in a company or organization. Meanwhile, payment is a process of invoicing and payment to supplier upon goods or services purchase.

Below is the cycle of procure to pay process:

Demand

The procurement process generates and manages requests for the purchase of goods.  The demand for purchase items may be a one-time event or may recur in either predictable or random time intervals.

Source

The procurement sourcing process covers the business activities related to the search, qualification, and selection of suitable suppliers for requested goods and services.

Order

The procurement ordering process includes purchase order placement by the buying organization and purchase order execution by the supplying organization.

Receive

The receipt process acknowledges that a purchase order has been duly executed.  For orders of physical goods, it will typically include the receipt, inspection and delivery of the goods to inventory or to another designated location.  For orders of services, it will typically consist of a notification from the requester or the approving person that the service has been performed as agreed.

Pay

The payment process consists of those activities involved in the payment for ordered goods and services.