If you are a public sector organization in Europe, you have probably heard of the Pan-European Public Procurement Online (PEPPOL), a promising initiative to improve procurement across the region’s public sector and to drive cost savings. So when should your organization start thinking about PEPPOL? The answer is right now.
PEPPOL was started in the Nordics as a project to foster competition and create an open marketplace that the public sector across Europe could utilize for better products, services, efficiency, and prices. Today it is quickly gaining traction. As an example, the National Health Service of the United Kingdom has set a requirement for all of its suppliers to have access to PEPPOL by September 2016.
How it works
PEPPOL offers a common set of e-procurement standards for public sector organizations across Europe. The standardization focuses e-commerce documentation including e-catalogs, e-orders, e-invoices, product descriptions, and certification of organizations. PEPPOL also provides an open and secure network for document exchange and evaluation.
PEPPOL is relevant to both the public and private sector. Private companies have similar access to the network and make up the majority of suppliers. As it becomes more widely adopted, both public and private sector organizations and e-procurement solution providers within or servicing European markets will need access to PEPPOL to ensure full access to the relevant European trading partners.
In order to make full use of PEPPOL, most organizations will need an efficient e-procurement system that serves as their Access Point or “gateway”. While PEPPOL can provide the set of standard and the network of trading partners, you will still need an IT platform that is user friendly, drives compliance, and provides real-time analytics for your C-suite.
There are three ways to access PEPPOL. You can choose to access the PEPPOL system through the web, your own ERP system or an e-business tool. While the latter two options may require greater investment, they will be essential for any organization working with large volumes of PEPPOL transactions. The alternative of access directly through the web involves high amounts of manual administration, which can be inefficient and expensive in the long term. Having professional support is also recommended as inexperienced users trying to solve major issues or manage complex transactions can pose a business risk.
Picking a point and a supplier
When selecting a supplier, you should look for one with PEPPOL transaction experience rather than a provider that is only registered to be an access point. Transaction experience will ensure you have access to a full understanding of the PEPPOL network and its set of standards, rather than just theoretical knowledge. The experienced supplier can reduce the time for decision-making, stakeholder buy-in, and implementing changes—all of which improve your competitive standing in the market.
Mixing it up
It is important to realize that PEPPOL is not a stand-alone solution to an organization’s procurement needs. It will be an essential way to access the majority of trading partners within Europe, but you will need to engage with a global network of suppliers. Therefore, while adopting PEPPOL will bring tremendous benefits, most organizations will need to work with suppliers outside the network through the aid of a global e-procurement tool and supplier network.
Gaining access to PEPPOL should be a priority for European companies. Faster transactions, greater access to suppliers, and cost savings make it highly relevant.
To see the benefits in action, learn how the City of Bergen achieved a 20% reduction in process costs with a procure-to-pay solution connected to PEPPOL.