Procurement: How companies successfully reduce their purchasing costs

24-year-old Max Walk has done what many company buyers dream of. He has developed AI-supported software that relieves him of time-consuming, repetitive inquiries from suppliers and reduces costs. He estimates the time savings for a sample part to be procured at 76 percent, and the cost savings at twelve percent. In total - "sourcing is a huge cost block" - this has a significant impact on the balance sheet.

"We can implement more, and the results are getting better and better," says the founder of the Munich start-up Sourcevise, which procures purchases for companies like Edding.

Saving advantages in procurement: this is where Walk is fully in line with the trend of digital automation of procurement processes. Numerous providers, like him, who presented at the "Procurement Summit" in Hamburg in June, are ready. According to the medium-sized company purchasing barometer 2026 by the IT service provider Onventis and the Federal Association of Materials Management, Purchasing and Logistics (BME), around 70 percent of the companies surveyed see a great need to automate supplier management.

On the other hand, Walk's determined digitalization is by no means typical. Around two-thirds refer to a lack of necessary resources. Only just under 19 percent consider their automation level to be mature, and only six percent their AI use. "People talk about AI, know the advantages, but it is only practiced in a very few companies," says Marc Kloepfel, CEO of the consulting firm Kloepfel by EPSA, one of the leading purchasing consulting firms. "Usually, things continue as before."

The fact that Max Walk did not hesitate to transform traditional processes into a contemporary business model after studying management can be explained by his family-related career perspective in a trading company in the food industry. When he started as a junior in his father's company group IIC International, going through the usual stations, "I got stuck in procurement."

The prospect of spending his time in the future writing repetitive emails, checking offers, and processing orders motivated him to simplify the processes. "The idea was already there, but now it was technically feasible," says Walk.

How it works is shown by a research project for a customer company. He enters technical data into a search mask for a specific plastic membrane for the construction industry. This triggers a KI research on the web and shows possible suppliers. The programmed agent writes to the companies - mainly Chinese ones in this case - evaluates the offers, and formulates answers based on the question: How would a buyer react to this?

"This is a great relief from work," says Walk. Sourcevise uses large LLM models like ChatGPT, including translation, and limits their scope with narrow instructions.

KI agents negotiate with KI agents

Technically speaking, even more extensive solutions can be used. KI agents negotiating with KI agents: "I wouldn't have thought of such a development three or four years ago," says Oliver Schöllhammer, head of the Digital Industries business division at the Fraunhofer Institute for Production Technology and Automation IPA in Stuttgart.

Over 100 projects are running there with the goal of digitalizing and automating company processes, including procurement or sales. One of the projects is a homework assignment: optimizing the IPA's procurement. Even if the same things are always procured, there are no automatisms for order processing, price calculation, or offer creation.

Procurement runs like in many companies "still very manually and with many people involved." To "free up" this through upcoming digitalization, as Schöllhammer says, should give them the time that is often lacking in so-called strategic procurement.

Strategic procurement is the part of procurement where intense negotiations are worthwhile. "That's where the music plays," says Sven Czeczatka, specialist for courses at the BME Academy, which offers further training in procurement and logistics. "The goal is to largely digitalize and automate the operational business in order to focus on strategically important things like negotiations."

This is also how Schöllhammer sees it: "The employees would be better deployed to build relationships with suppliers." The practice of buyers looks different. "They don't negotiate, they just order," says Czeczatka. Changing this requires new digital systems: "No investment, no return."

The widespread restraint is attributed to sales-dominated management. "Often, there is a lack of commercial understanding that procurement is the much bigger lever compared to sales." This means that one million euros more in sales with a sales margin of five percent only brings 50,000 euros more profit. One million euros saved in procurement costs means: one million euros more profit. "To double the margin purely through optimization of procurement is definitely possible," says purchasing consultant Kloepfel.

One problem: "Often, there is a lack of overview. Many purchases are made outside of procurement." The secretariat books travel, marketing awards print orders, and production purchases maintenance. Overall, the procurement volume is around 50 percent of sales, says Kloepfel. As a rule, 70 percent of this can be optimized, he explains to his mostly medium-sized customers, who often stick to traditional suppliers.

Changing them is usually not necessary. "Most of the savings are achieved with existing suppliers." Solutions can be found in workshops that satisfy both parties.

An example are saved freight costs. In the logistics area, projects by the consultancy achieve savings of 16 percent.