It’s instructive to see procurement as a ‘game of two halves’. Finding and achieving the best value from the market are difficult enough tasks – particularly without the right tools at your disposal – but it is only half the job.
The next part requires you to derive maximum benefit from your supplier relationships on an ongoing basis and there are all kinds of factors at play that make this difficult.
Most of the time, a combination of misconceptions and challenges mean costs creep up and more often than not, savings targets are not reached and the projects – and faith in procurement’s ability to get the job done – falter.
Getting the right deal
Market knowledge and visibility are the vital ingredients to getting the right deal. Manufacturing firms and retailers in particular recognise this. Selfridges have their fashion buyers and Waitrose have their wine and cheese buyers, each expert in their fields. Manufacturing buyers of raw materials have their pricing indices and market data.
Detailed understanding of not only the product, but also the wider industry and its pressures – especially in a globally connected world fraught with uncertainty – is vital to achieving optimal value from any given market. As we’ve shown, there are all kinds of factors influencing price and extracting value from complicated, fluid markets is an exercise that requires the kind of knowledge, experience and data embodied by our specialists.
Detailed market knowledge, daily visibility of price, understanding of which suppliers are performing, who is delivering value – and who is not – is only achieved with expert guidance. Having specialist knowledge on tap to assist with negotiating contracts can prove invaluable in identifying punitive price rises built into contracts. Our experts produce professional tenders that optimise both value and service, whilst accurate specification of requirements ensures suppliers need not load in margin for unknown quantities.
For more information, please contact us.