.webp)
How many Excel spreadsheets have you opened today? If you work in procurement, the answer is probably: "Too many to count."
Sarah, head of procurement at a mid-sized mechanical engineering company, knew this feeling all too well. Every morning, she'd start her computer and routinely open 15 different Excel files: Supplier_Evaluations_V3_final_FINAL.xlsx, Cost_Comparison_Q1_revised.xlsx, RFQ_Tracking_current.xlsx - and that was just the beginning.
A typical day meant endless copy-pasting between different files while wondering: "Which version is actually the current one?" When her category manager quit and took his carefully maintained Excel lists with him, the entire procurement team was left in chaos.
This story is familiar to 94% of all companies, because according to a recent study by universities in the USA, Australia, and Hong Kong, 94% of all corporate spreadsheets contain errors. Why Excel might be a strong start but becomes a bottleneck once you hit 5 suppliers, 10 stakeholders, and complex requirements is what you'll learn in this blog.
Excel is the "Swiss Army knife" of modern procurement, and for good reason. No other software is as universally available, flexibly customizable, and cost-effective. For quick analyses, simple calculations, and initial supplier comparisons, Excel is unbeatable.
The advantages are obvious:
But these strengths quickly become hidden weaknesses. What begins as a practical solution gradually develops into time-consuming loss of control. The European Spreadsheet Risks Interest Group estimates that over 90% of all spreadsheets contain errors and 24% with formulas have direct calculation errors.
The hidden risks:
The tipping point usually comes gradually. A mid-sized automotive company discovered only after years that a large portion of their procurement was bypassing the purchasing department - classic maverick buying. According to APQC research, organizations with high maverick buying can take up to 16 hours longer for order processing and pay $2.58 more per $1,000 in purchase volume.
Scaling Across Multiple Locations As soon as multiple plants or countries are involved, Excel becomes a data graveyard. Different currencies, varying suppliers, and local peculiarities overwhelm even the most sophisticated spreadsheet solutions.
Compliance and ESG Reporting Modern sustainability reporting demands complete supply chain documentation. With Excel, it's practically impossible to systematically track CO2 footprints, supplier diversity, or compliance violations.
Supplier Risk Management Maverick spending can account for up to 80% of a company's purchase volume, significantly impairing cost control capabilities and supplier relationships. Excel cannot detect or prevent these critical deviations in time.
Complex Sourcing ProjectsWith RFQs involving 20+ suppliers, various evaluation criteria, and multiple negotiation rounds, Excel becomes torture. Version conflicts, lost data, and evaluation errors are inevitable.
Excel may seem free, but the total cost of ownership is alarmingly high. The true costs hide in inefficient processes, missed opportunities, and human errors.
Version Control Chaos
"Is this the version with the updated prices or the one from last Friday?" This question costs German procurement teams an average of 2.5 hours per week. Nobody knows for certain which file is the most current - with fatal consequences for decisions.
Error-Prone Manual Entries
Fidelity Magellan lost $2.6 billion in 1995 due to a forgotten minus sign, JP Morgan Chase lost up to $6 billion in 2012 through faulty copy-paste operations. Even though smaller companies rarely lose such amounts - 5% error rate in manual data entry quickly adds up to significant losses.
No Real-Time Updates
While modern sourcing tools provide live data, Excel lists are always historical. Price changes, supply shortages, or quality problems become visible only with delay - if at all.
Single Point of Failure
Everything depends on one person who "understands the system." Vacation, illness, or resignation means immediate loss of control. "What happens if your category manager leaves tomorrow? What remains of the transparency?"
Organizations without automation pay an average of $107 per order, while automated systems cost only $32. For a mid-sized company with 10,000 orders annually, this equals $750,000 in additional costs – just from manual processes.
Through systematic automation of routine tasks, companies can operate with 21% reduced labor costs, leading to significant cost savings and higher returns.
The future of sourcing is data-driven, automated, and intelligent. While Excel fans are still manually adding columns, advanced procurement teams already use AI-powered systems for strategic decisions.
Unified Data Model
Instead of 47 different Excel files, one central database that holds all supplier, price, and contract information in real-time. Every stakeholder works with the same, current data.
Automated Workflows
RFQ creation, supplier communication, and evaluation processes run automatically. What used to take days, the system completes in hours, with higher accuracy and complete documentation.
Real-Time Supplier Evaluations
Continuous performance monitoring replaces sporadic Excel scorecards. Quality problems, delivery delays, or price deviations become immediately visible and trigger automatic alerts.
Predictive Analytics Instead of Gut Feeling
AI analyzes historical data to predict price trends, identify risks, and recommend optimal procurement timing. Decisions are based on data, not guesswork.
Collaboration Without Version Chaos
All participants work in the same platform. Changes are immediately visible to everyone, comments and approvals happen directly in the system. No more email chains with various file attachments.
Compliance by Design
Audit trails are automatically created, approval processes are systemically anchored, and regulatory requirements are monitored by the software. "No tool replaces Excel blindly – but it finally turns your numbers into real decisions."
The biggest challenge isn't in the technology, but in the people. According to McKinsey, 70% of all transformation projects fail due to inadequate change management. When replacing Excel processes with intelligent sourcing systems, resistance is particularly high, after all, employees have spent years perfecting their "proven" spreadsheets.
"But my Excel file works perfectly!" - IT and procurement managers hear this sentence daily. The emotional attachment to Excel solutions is real and justified. Employees have invested time, energy, and expertise in their spreadsheets. New software feels like devaluation of their work.
Typical resistance to Excel replacement:
Phase 1: Assessment & Quick Wins (Weeks 1-4)
Don't start with the biggest Excel problem, but with the simplest. Identify 2-3 recurring, standardized processes that can be automated immediately.
Example: RFQ tracking for standard parts
Instead of manual Excel lists, automatic status updates with email notifications. Immediate time savings: 3 hours per week. These quick wins create trust and momentum.
Phase 2: Champions Program (Weeks 5-12)
Identify the most competent Excel users as change agents. These colleagues understand the pain of manual processes best and can serve as multipliers. Train them intensively in the new system and have them document their experiences.
Phase 3: Parallel Operation & Validation (Weeks 13-20)
Run both systems in parallel and continuously demonstrate the superiority of the new solution. Document every error, every time saving, every insight gained. Use data instead of emotions for persuasion.
Phase 4: Migration & Optimization (Weeks 21-26)
Only when trust is established, gradually phase out Excel. Provide intensive support and establish feedback loops for continuous improvement.
Communication is Everything
Don't communicate the features of the new system, but the solution to concrete daily problems. Instead of "Our system has AI-powered supplier evaluation," say "Never miss delivery dates again with automatic alerts."
Training That Works
69% of transformation projects fail due to inadequate training. Develop role-based training:
Making Success Measurable
Real-time tracking of adoption metrics:
Intelligent procurement begins where Excel ends, with automatic recognition and processing of procurement requests. Mercanis combines cutting-edge Agentic AI with proven sourcing methods into a comprehensive platform.
Intelligent Sourcing Automation with Agentic AI
The system supports automated creation of sourcing events and can intelligently process free-text requests. Mercu AI analyzes internal procurement data and external market information to optimize sourcing processes and significantly reduce manual tasks. Product specifications are recognized and the sourcing process is systematically supported.
Proactive Savings Recognition and Intelligent Cost Optimization
The system automatically recognizes savings potential and suggests cheaper alternative suppliers. Through continuous market analysis, Mercanis identifies situations where new negotiations make sense or framework agreements should be optimized. When existing suppliers have price jumps, the system proactively warns and points out savings opportunities before inefficient procurement decisions are made.
Live Tracking Instead of Dead Spreadsheets
Every sourcing process is trackable in real-time. From the first request to the final order, all participants see the current status. No more lost emails, no more forgotten follow-ups.
9:15 AM: Production manager sends email: "Urgently need 500 pieces of SKF 6203 ball bearings for Line 3, delivery by Friday"
9:16 AM: Mercanis AI automatically analyzes the email and extracts:
9:17 AM: The buyer immediately sees suggested suppliers for this item:
9:20 AM: Buyer selects the predefined workflow with pre-filled information and sends the order to Supplier A within minutes.
9:25 AM: Automatic confirmation to all parties, information in one place and thus quickly and easily accessible for future orders..
Total time spent: 8 minutes instead of 2 hours
The shift from reactive to proactive procurement is already underway. According to an IDC study, usage rates of Intelligent Process Automation (IPA), Robotic Process Automation (RPA), and Artificial Intelligence will rise rapidly in the next 24 months.
Leading companies already use autonomous sourcing systems that don't just react but anticipate. These systems analyze market trends, forecast price developments, and proactively suggest procurement strategies.
The Excel era in sourcing is coming to an end. What once began as a practical solution has today become a barrier. With 94% faulty spreadsheets and up to $2.58 additional costs per $1,000 purchase volume, companies simply can't afford manual processes anymore.
Modern sourcing platforms like Mercanis offer not just efficiency improvements, but fundamental competitive advantages:
The ROI is measurable and quick: Organizations implementing procurement automation realize savings of over 40%. For a mid-sized company with €10 million purchase volume, this equals €4 million annual savings potential.
The question is no longer whether you'll switch from Excel to intelligent sourcing systems, but when. Every day with manual processes costs money, time, and nerves.
Excel was designed for individual spreadsheet calculations, not collaborative business processes. With growing complexity, manual processes lead to 94% error rates, version chaos, and lack of transparency. Modern companies need automated, data-driven solutions
Main risks include high error rates, hidden costs of up to €75 per order, single point of failure during staff changes, and lack of scalability. Additionally, compliance requirements and ESG reporting cannot be adequately fulfilled.
Maverick buying refers to purchases outside established procurement processes - often due to lack of transparency and cumbersome processes. This can account for up to 80% of purchase volume and leads to missed framework contract conditions, higher costs, and lack of spending control.
AI-powered systems automate routine tasks, analyze market data in real-time, and proactively suggest optimizations. Instead of reacting to problems, they recognize savings potential and risks before they occur.
Especially companies with 50+ employees, multiple locations, or complex sourcing requirements benefit significantly. But even smaller companies quickly see ROI through time savings and error reduction.
Begin with a needs analysis of your current Excel processes. Identify 2-3 simple, recurring tasks for quick wins. Start with a pilot project and gradually build trust within the team.
Fabian Heinrich is the CEO and co-founder of Mercanis. Previously he co-founded and grew the procurement company Scoutbee to become a global market leader in scouting with offices in Europe and the USA and serving clients like Siemens, Audi, Unilever. With a Bachelor's degree and a Master's in Accounting and Finance from the University of St. Gallen, his career spans roles at Deloitte and Rocket Internet SE.
.webp)
.webp)
