How to maintain successful procurement compliance in 2025

Procurement compliance isn’t a one-size-fits-all policy. Every purchasing department needs to navigate unique rules, keep up with changes to internal compliance measures, and external regulatory requirements. But monitoring these shifts is a massive task—and when you add sharing information across teams and updating procurement systems, it can quickly become an ongoing headache.

However, you can ease the strain and minimize procurement risk by having control and visibility into your purchasing processes. To gain this, organizations across industries are transforming traditional procurement with flexible, integrative software that supports compliance throughout the purchasing process. 

To get the most from an intelligent solution, you first need to understand your current procurement cycle and its challenges. This will help you craft a strategy that balances compliance, operational efficiency, and cost savings. Read on to find out how.

Understanding procurement compliance

Procurement compliance is how your team adheres to external and internal regulations that guide every step of the purchasing process. Strategic sourcing, contract management, approval workflows, and payment processing are all standard procurement functions that must abide by these guardrails. Such rules intend to minimize your organization’s risk of fraud, operational errors, and financial missteps. 

However, enforcing compliance management is challenging for organizations of all sizes. Common issues include poor record-keeping, maverick spending, expired vendor certifications, and lack of communication. 

To address these potential compliance issues, take a look at specific procurement practices and their compliance risks.

Key types of compliance in procurement

Procurement compliance falls into two categories: internal and external. Here are common internal compliance examples:

• Contract management: Track whether suppliers adhere to the agreed-upon contract conditions. 

• Supplier management: Measure a vendor’s efforts to maintain ethical business practices and a sustainable supply chain. 

• Invoice and purchase approval limits: Ensure adherence to established budgets for vendor invoices and buyer purchases. 

• Conflict of interest transparency: Make sure there’s open acknowledgement of potential conflicts of interest between parties. 

As the name suggests, internal compliance refers to the controls that your organization establishes to guide its procurement activities. 

On the other hand, external procurement compliance involves regulations that governments or industry policymakers establish. Below are examples: 

• Environmental and sustainability laws: These are rules that governments or specific industries create to ensure that organizations maintain ethical practices. 

• Tax compliance: Any regulations that impact procurement taxes and tariffs will fall into the external compliance category.

• Supplier certifications: These qualifications determine if a vendor can provide specific types of products.

To navigate both kinds of compliance with ease, it helps to recognize the hurdles you could encounter in the process.

Four key challenges in procurement compliance

Here are the most common compliance challenges that your organization may face: 

1. Gaining spend visibility and policy enforcement

Without financial visibility, it can be difficult to review order amounts, where money goes, or if buyers are purchasing from preferred suppliers. Additionally, poor operational visibility can limit your ability to enforce purchasing policies because your team doesn’t have enough insight into the vulnerable parts of your workflow. 

Spend Visibility (a Business Prime feature) offers dashboards and visual analysis that allow you to easily track spend, orders, compliance, and suppliers across multiple teams so you can analyze trends and identify inefficiencies in real time. By breaking down spending by category, supplier, or item, your team can uncover opportunities to consolidate orders, negotiate better deals, and reduce costs. 

2. Lacking visibility into supplier compliance and risk

On-time delivery, product quality, responsible purchasing, and ethical business practices are all part of maintaining reliable supplier relationships and vendor regulatory compliance. However, it’s often difficult to monitor all these supplier performance metrics by hand. Your team might face an even greater challenge if you work with several vendors, monitor organization-wide procurement, or lack clear insight into vendor contractual requirements. 

3. Tracking and documenting regulatory compliance

Manual workflows and disconnected systems can leave you with scattered information that makes creating an audit trail almost impossible. Additionally, if you don’t have standardized purchasing workflows, monitoring compliance can be even more complicated. 

But automation can help you resolve these bottlenecks. Digital procurement tools can automate routine tasks like approvals and purchasing workflows by setting custom guardrails aligned with your compliance requirements. This not only minimizes the risk of human error but also ensures that all transactions adhere to company policies. 

4. Enforcing compliance in hybrid procurement models

A hybrid procurement model combines centralized and decentralized purchasing. While this gives teams flexibility, it can complicate compliance because each approach has different policies. 

Digital compliance tools, like Guided Buying (a Business Prime feature) can address this challenge by allowing organizations to establish customized guidelines that ensure compliance while supporting team preferences for approved vendors. 

Six essential procurement compliance metrics

While navigating procurement compliance challenges, your team needs to monitor your progress. To gain a data-driven understanding of the impact of your efforts, track these six metrics:

1. Supplier performance: Measure how often suppliers stray from the quality, products, and services they promised. 

2. Contract compliance: Track whether vendors stick to contract terms, like pricing, delivery timelines, and product quality expectations. 

3. Rogue spending: Monitor the rate of maverick spending across your organization.

4. Purchasing process time: Trace the duration of one procurement cycle, from purchase order to supplier invoice payment. 

5. Adherence to budget: Record your team’s spending and compare it to the expected budget.

6. Non-compliance: Document instances of purchasing compliance violations.

Once you’ve defined these measurable analytics, you can implement your program.

How to implement a procurement compliance program

Once you’re ready to capture results, you can lead your team through these simple steps to kickstart your compliance program: 

Step 1: Define procurement compliance policies and risk frameworks

Start by assessing your current procurement policies, risk mitigation techniques, and operational problem areas. To do so, follow these steps:

• Document your internal purchasing policies: Centralize all your organization’s compliance requirements so you can assess everything in one place. 

• Collect external regulations: Store any applicable external procurement regulations in a central location that teams can easily reference.

• Assess your risk mitigation approach: Audit your current strategy to identify and mitigate risks, as well as your protocols, in case of a regulatory violation. 

• Analyze data to identify high-risk areas: Evaluate your current purchasing data to find areas where a lack of insight and control exacerbates risk. 

Documenting these factors will help you understand your current compliance landscape and create a foundation for improvement. 

Step 2: Automate your compliance processes

Once you understand your current process, you’ll select which parts you want to automate. 

To implement automations that will streamline your process, follow these steps:

• Integrate existing systems into a unified purchasing solution: Connect all your systems so all purchases happen in one place, lowering risk of regulatory violations.

• Set up a routine compliance audit: Decide how often you want to conduct audits to assess your risk and ensure you never fall behind on new regulations. 

• Establish analytics dashboards: Set up policy dashboards to provide your team with access to real-time data they can use to make better buying decisions. 

• Automate routine tasks: Identify and automate routine tasks like invoice matching or requisition approvals, saving your team valuable time. 

Your efforts here will help you maintain compliance throughout your purchasing process. 

Step 3: Establish a system for vetting suppliers

The third stage is to create a process that helps you vet and approve suppliers. The following steps will guide how you’ll strategize supplier vetting: 

• Centralize supplier requirements: Place all your supplier requirements in one location so it’s easy to see if their performance strays from expectations.

• Compare vendors and determine liability: Use a solution that simplifies vendor comparisons and examines the partnership’s risk. 

• Analyze past supplier performance data: Review each supplier’s historical performance data to see if there’s a precedent for contract violations. 

• Automate routine performance audits: Set your procurement solution to run regular audits so you can stay on top of vendor performance. 

These steps help you establish a reliable foundation so you work only with compliant vendors. 

Step 4: Ensure enterprise-wide adoption and training

The effort you put into bolstering your organization’s procurement compliance will have little effect if your teams don’t adopt it. Because of this, you should make sure all your procurement professionals are on the same page with these strategies:

• Establish comprehensive compliance training: Ensure your stakeholders are aware of purchasing expectations and know how to find preferred suppliers. 

• Enforce user-based compliance monitoring: Track individual buyers’ purchases to directly enforce regulations where necessary. 

• Create a system to implement updates: Design a smooth process that simplifies updates for regulatory changes and continuous improvement. 

If you have a team that’s committed to ensuring compliance across your organization, your compliance program is more likely to be successful. 

Five procurement compliance best practices

No matter how you approach implementing your procurement compliance program, you can use these best practices to strengthen your strategy: 

1. Enforce centralized spend controls

Invest in an integrated solution that allows you to customize buying journeys, monitor compliance metrics, and enforce spend controls. For example, with Amazon Business, you can limit a buyer’s spending for more financial visibility and control. 

2. Source from a pre-approved supplier list

Collect approved suppliers into a list that can be a source of truth for buyers as they place orders. By making this information accessible, you’ll lower the risk of rogue spend. However, it’s essential that the list accurately reflects buyer purchasing needs, or you may still see buyers venture away from approved vendors to find specific supplies. 

3. Conduct regular compliance audits

Improving purchasing compliance is never a one-and-done effort—your process should also adjust to policy changes. To do this, build a comprehensive audit and choose a cadence for when you’ll run it. This ensures you’re proactively reviewing your purchasing process rather than responding to problems as they arise. 

4. Align with sustainability and ethical sourcing guidance

Ethical sourcing involves prioritizing vendors that focus on reducing harm to people and the environment in their business operations. More sustainable purchasing, on the other hand, is an eco-friendly approach to how your team does procurement. 

To maintain both, create standardized sustainability and ethical sourcing guidelines. Then, distribute these instructions, including a list of approved vendors and products, across your organization. 

5. Prioritize employee training

Employee training and communication are key to ensuring organization-wide compliance. When every team, buyer, and procurement leader knows the rules, you lower the risk of purchasing mistakes slipping through the cracks.

Additionally, investing in your employees’ knowledge helps them feel valued. If they see themselves playing a core role in improving purchasing compliance, the likelihood of them doing so will increase. 

Transform procurement compliance into a tool for profit and growth

Procurement compliance is a cornerstone of your operations that helps your organization stay safe from fraud, expensive delays, and overspending. But staying in control is difficult without the proper solutions and strategies. 

A digital purchasing solution that connects your existing systems can be the simplest way to confidently maintain compliant purchasing practices, improve operational visibility, gain data-driven insight, monitor risk, and streamline your processes with automation. With flexible features and agile functionality, our smart business buying solution can support your team’s goals in a way that makes sense for you.