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Source-to-Pay (S2P)

The source-to-pay (S2P) cycle includes all the activities related to sourcing and procuring goods and services. While closely related to procure-to-pay (P2P), S2P is much broader in scope. 

Source-to-pay includes the following activities in addition to the P2P cycle:

  • Identifying business goals and needs
  • Supplier evaluation
  • Contract negotiation
  • Supplier relationship management
  • Market analysis

S2P processes often rely heavily on software systems like ERPs to monitor supply chains and generate actionable insights. The efficiency of these systems can have a significant impact on how effectively a business sources supplies, and by extension, its overall strategy.

Related terms

Bill Capture
Bill capture, also known as invoice capture, refers to the process of extracting data from incoming bills, invoices, or purchase documents and converting it into a digital format that can be processed and managed electronically within an organization's accounting or enterprise resource planning (ERP) system.
Cash Conversion Cycle
The cash conversion cycle (CCC) measures the rate at which your business converts its investments and inventory into cash.
Cash Flow Coverage Ratio
A company’s cash flow coverage ratio (CFCR) clarifies its ability to pay its debts based on cash flow from operations.
Cash Flow Optimization
This strategy focuses on maximizing the inflow of cash while efficiently managing outflows to maintain a healthy liquidity position.
Cash Flow from Operations
Cash flow from operations measures the money a business generates from day-to-day activities, usually over a quarter or fiscal year.
Consolidated Invoicing
Consolidated invoicing, also known as centralized billing or grouped invoicing, is a billing process in which multiple transactions or charges incurred over a specified period are combined into a single invoice for payment.