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Cloud-based procurement refers to the entire lifecycle of buying, managing, and renewing SaaS, PaaS, and IaaS subscriptions. It offers complete visibility and control over the procure-to-pay cycle, ensuring business units can achieve their goals.

As SaaS adoption grows, so too does the need for reliable cloud procurement software that minimizes manual intervention.

Since cloud technology is operated remotely by automation, you don't need to invest time and money in additional hardware—you can streamline the entire procurement function of your tech stack.

Thanks to insights and data collected from hundreds of contracts and negotiations, digital-first teams can realize potential savings at a fraction of the energy the typical approach demands.

6 advantages of cloud-based procurement solutions

Cloud procurement tools have thrived in the market for many reasons. For starters, a reliable software procurement process allows organizations of all shapes and sizes to keep up with technology while simplifying SaaS spend management once and for all.

Here are some more advantages of cloud-based procurement solutions:

1. Seamless integration capabilities: One of the primary benefits of cloud-based procurement solutions is the ability to easily integrate with other software systems. This ensures a streamlined data flow, eliminating manual data transfers and reducing errors. Simply connect your ERP to �Թ�tv to get instant access to company-wide SaaS spend and usage data.
2. Procurement workflows: Cloud solutions offer structured procurement workflows for key stakeholders, allowing for better transparency and efficiency in managing purchase orders, approvals, and payments.
3. Cost-effective and scalable: Unlike traditional software, cloud-based procurement solutions are often subscription-based, making them more cost-effective. Plus, they are scalable to meet the changing needs of the business.
4. Spend visibility and control: With cloud-based solutions, companies can have 360-degree visibility of their expenditure, ensuring they stay within budget and make cost-effective purchasing decisions.
5. Easy-to-use interface: Most cloud-based procurement platforms prioritize user experience, offering intuitive interfaces that reduce the learning curve for new users and accelerate user adoption.
6. Customer support: Reliable customer support is a hallmark of leading cloud procurement providers. With round-the-clock assistance and uptime guarantees, businesses can resolve issues swiftly and keep their operations running smoothly.

What are the 3 types of cloud-based services?

Cloud procurement systems are generally categorized into three distinct models:

1. Software-as-a-Service (SaaS)

This model allows businesses to access software over the internet on a subscription basis for little upfront investment. SaaS solutions are hosted on the provider's servers, ensuring users always have the latest version without worrying about updates or maintenance.

Most ready-to-use, cloud-based procurement solutions fall under the SaaS model. Pricing is often based on factors such as usage duration, data storage, user count, and transaction volume. This model is appealing for its quick deployment, easy implementation and low initial costs.

2. Platform-as-a-Service (PaaS)

PaaS offers a comprehensive platform for users to develop, operate, and manage applications without the complexities of maintaining a cloud infrastructure. It encompasses tools for development, databases, networking, operating systems, servers, and storage. Pricing for PaaS typically involves a flat fee based on service use and user count, with some providers offering pay-as-you-go options.

PaaS is a preferred choice for software developers who wish to customize procurement software to meet specific needs. Unlike SaaS, PaaS grants users the autonomy to manage their databases. It is particularly beneficial for organizations with numerous internal tools requiring integration into the procurement process, or for those with unique, non-standard procurement needs. PaaS also supports dynamic procurement workflows that may evolve throughout different project stages.

3. Infrastructure-as-a-Service (IaaS)

IaaS provides cloud-computing services where users rent servers that underpin the procurement solution's infrastructure. This model offers significant flexibility, especially for hosting bespoke software or shared data centers. IaaS is ideal for organizations seeking complete control over their procurement platforms or those with evolving requirements.

The evolution of cloud-based procurement

Software-as-a-service solutions started rolling in when procurement leaders and teams found it hard to adapt to the digital reality. It was a challenge for some, not all, procurement teams to rapidly deploy on-premise applications that can execute what a business needs and desires.

Cloud procurement platforms like �Թ�tv give all the glory of traditional software reliability without hosting costs, update downloads or complex hardware.

Data stored in the cloud belongs to the customer and is only hosted by the provider. The management of contracts, negotiations, renewals, and more are either updated automatically online or taken care of by the procurement team.

As businesses continue their digital transformation journey, cloud procurement platforms will become increasingly vital. Features like AI-driven analytics, mobile app integration, and advanced business intelligence tools will further enhance the procurement experience. 

6 best practices for cloud procurement

If you want your transition to a smart cloud-based procurement process to be smooth, it's essential to follow a time-tested strategy. The following tips will help you minimize mistakes, identify savings opportunities, eliminate maverick spending, and achieve business outcomes.

1. Set business goals

Aligning your procurement strategy with your business goals is crucial for risk management. Understand your organization's needs and set priorities correctly by writing down each potential business problem, goal, or scenario and the corresponding software to meet them.

2. Right-size subscriptions

Paying for what you don't need is reckless for any organization. Evaluate your SaaS stack from time to time so you can focus on the features and capabilities that you actually want at lower prices.

3. Test drive

Who doesn't like free trials? Take advantage of free software trials, if available, to ensure the procurement software is the one for you. The amount of functionality must correspond to the size of the companies.

4. Understand contracts

Never sign any agreement that you don't fully comprehend. Read the terms and conditions carefully before closing deals with any SaaS solutions. Take note of every clause on license management, costs, renewals, and how end-users may access and use the software.

5. Vendor management expertise

Your SaaS solution should have your back in negotiations. Try to pick a SaaS procurement service that has vendor relationship management.

Procurement professionals can bring unmatchable experience to the table since they negotiate contracts repeatedly and know the market for substantial savings

6. Ask for support

Don't be afraid to ask too many questions. Investigate what you don't understand and explore your options. A team responsible for a procurement SaaS solution should exist to take away your worries and give you all the knowledge you need.

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Put your procurement on autopilot with �Թ�tv

Our highly automated software-as-a-service procurement solution provides several key benefits. For one, It centralizes your purchasing and contract negotiations while streamlining your SaaS stack to be cheaper, faster, smaller, and better.

Software like �Թ�tv can help your SaaS discovery, negotiation and management process run smoothly so you can focus on more critical business tasks. See how it works.

Here's how the �Թ�tv platform helps companies manage their reach stack, meet compliance standards and turn SaaS procurement into a competitive advantage:

• Compare your contracts to $1.8 billion in managed and benchmarked enterprise software spend.
• Get all your tools and subscriptions in one place, from Under Consideration to In Trial to New Negotiation.
• Minimize upfront costs and keep a close eye on both your potential and achieved savings.
• Receive regular alerts for upcoming renewals, deadlines, and other important dates.
• Request instant support from a dedicated CSM team.

�Թ�tv covers the whole SaaS purchasing process, including price benchmarking, smart vendor relationship management and contract negotiations. Your company can save money now and in the future.

Discover now how much you can save on SaaS licenses today with our SaaS savings calculator.