Elcom PECOSTM e-Procurement (Professional Electronic Commerce Online System) is a web-based software system designed specifically to enable purchasing departments to link electronically with their approved supplier base to view, compare and order any kind of product using a clear, simple and easy purchasing process that can be executed in just three clicks of a mouse button. PECOSTM is the world's most advanced multi-tenancy e-procurement solution available to government, parastatals, educational organisations, healthcare institutions, commercial enterprises and all buying departments.
By the simple implementation of Elcom's e-Procurement, a user can expect to save 10% to 20% of their procurement budget that is managed through the PECOSTM platform.
The PECOSTM Concept
The PECOSTM system has been tailored to provide a facility for commercial banks to offer a value-added service to their key customers. The PECOSTM system is made available to the bank for use by its customers free of any upfront fees, except for the cost of the initial installation and staff training for the bank's client. The value-added element for the bank is that the bank's client will pay a monthly service charge that is based upon a small percentage of the client's expenditure made through the PECOSTM platform.
There are additional financing facilities that form part of the PECOSTM e-procurement process for which the bank may make additional charges should the client wish to utilise these services. These additional features are described below in more detail under “The PECOSTM Early-Settlement Funding”.
The Elcom PECOSTM platform is only made available to users through their bankers and so the bank is the primary facilitator of this unique service to its clients. The benefits obtained by the bank's client from using the Elcom PECOSTM system, both in terms of cost savings and improved business processes, are exceptional and more than cover the cost of the bank's service fee.
Benefits of PECOSTM to The Bank's Clients
Clients using the Elcom PECOSTM e-procurement platform can expect savings of up to 20% of their procurement budget resulting from its dynamic and beneficial features that include:
- Quick implementation (within three months)
- Easy to use with as few as 3 clicks of a mouse to create purchase orders
- Improved procurement controls & procedures
- Lower transaction costs
- Comparative and competitive pricing
- Elimination of non-compliant expenditure
- Faster payment cycles
- Fewer disputes
- Economies of scale
- Search tools covering a vast resource of information
- Integration with most existing logistics and finance systems
- Amalgamation of over 100 separate systems into one simple platform
- Web based for easy access & utilisation
- Operates over mobile phones
- No upfront charge other than for installation & training
- Fees based only on ad valorem usage
After using PECOSTM 98% of users have confirmed that they would not want to return to their old purchasing method.
Deployment of PECOSTM to the Bank's Client
The first stage to implement and install the basic PECOSTM service involves the following three simple steps:
- The bank obtains an order from the client's purchasing department for the PECOSTM software, which is supplied free of charge, with only an installation fee based on the number of users/PCs. This charge includes the cost of installation and training of the client's designated staff.
- The bank's client will then populate the PECOSTM system with their own protocols and procedures, such as the payment terms for each supplier, order value restrictions for their designated staff, which managers and what management levels are required to approve the purchase orders. We can assist with this process if required.
- The client's purchasing department can then request all their approved suppliers to upload their product catalogue to the Elcom PECOSTM portal, which is designated for the client's exclusive use eg, specially discounted prices offered by the suppliers to the client can only be viewed by the selected management of their own organisation.
This completes the basic set up and deployment, following which the client will have created and have access to its own customised internal ‘Marketplace' through the PECOSTM platform. The client's designated staff will then be able to view, compare and purchase any of the products that have been uploaded by their approved suppliers via the PECOSTM portal (subject of course to the order confirmation protocols and procedures input to PECOSTM by the client).
Ordering from an external Marketplace (i.e. from non-approved suppliers that have not uploaded their catalogues) is also enabled by PECOSTM. External Marketplace orders are imported into the PECOSTM system and processed with the same protocols established by the customer during the initial set up process (see below “PECOSTM ordering from an external Marketplace”).
PECOSTM Reporting Tools and Data Mining
The reporting tools provided by PECOSTM will identify much previously undetected inefficiency within a user's purchasing process. For example, by using PECOSTM the Scottish Government discovered that they had over 70 suppliers of A4 paper, with each supplier invoicing at different price levels (plus freight charges), whilst several were delivering the same product to the same building. The Scottish Government's procurement department were able to reduce their A4 paper suppliers from over seventy to just six, renegotiate their prices, eliminate the additional delivery charges and consequently saved 12% of their original costs. Implementation of the PECOSTM platform over all their departments has saved The Scottish Government in excess of €1bn in only 7 years.
PECOSTM Product Features:
PECOSTM Early-Settlement Funding
Following installation of the PECOSTM portal, the e-procurement process may be further and greatly enhanced by implementing the unique and very powerful feature of Elcom's latest software, which is the early-settlement funding facility. On top of the significant savings that can be made by the customer by using PECOSTM, the software also provides the customer's suppliers with the option to select ‘early-settlement' of their sales invoices. This can be initiated by a supplier when accepting the customer's purchase order and enables the supplier to deliver without delay in the certain knowledge that he will receive prompt payment for the goods and services provided.
The early-settlement funding facility within PECOSTM works as follows:
- The bank will provide its client with a finance facility that will enable the bank to pay the client's suppliers direct when the supplier has selected the early-settlement option. The finance facility provided by the bank is typically based on a revolving credit line that is rolled over on a monthly basis. However, the financing period may be extended or restricted based on the bank's own arrangement with the client.
- When an approved purchase order is issued by the client, their supplier has the option on the PECOSTM platform whether to accept the standard payment terms (as input by the client through PECOSTM) or alternatively to receive early-settlement payment direct from the bank.
- When early-settlement payment is selected, the supplier will fulfil the order and submit an invoice to the customer via the PECOSTM platform. Once the customer has approved the supplier's sales invoice, a copy of the approved invoice together with the associated data will be forwarded electronically by PECOSTM to the bank, which is then obliged to process the payment immediately. The value of the invoice payment made by the bank is then debited to the client's revolving credit line.
Value-Added Service to the Bank
The inclusion of the early-settlement payment option within the Elcom PECOSTM platform provides a truly unique feature to the e-procurement process. The early-settlement facility greatly enhances the ability of the customer's purchasing department to deliver its KPIs (key performance indicators) with a smooth and seamless buying process. At the same time, the bank is able to offer its clients an extremely powerful and useful tool that improves their client's business process and in addition generates value-added income for the bank.
PECOSTM Early-Settlement Finance Insurance
The bank may understandably have concerns about providing a revolving credit facility to some clients. In order to allay any initial concerns and so assist the bank in providing the necessary funding to its clients for the early-settlement finance, Elcom PECOSTM can arrange insurance through Lloyd's of London to underwrite the revolving credit line in Nigeria in the event of default by the bank's client.
PECOSTM Service and Support
Elcom PECOSTM provides the bank's client with 24/7 maintenance of their PECOSTM platform and, through Bishopsgate, a full on-site service support for their staff and IT systems in Nigeria.
PECOSTM Case Study
Economists have estimated that if the early-settlement payment system were implemented across the board, it could increase local economic activity by as much as 31%, which in turn would generate much needed additional tax revenues to government. PECOSTM is a tool that has the potential to have a significant economic impact that government should consider utilising to assist the local economy.