Your Procurement Health Dashboard

May 24th, 2018

How are you tracking the health of your company’s procurement?

 

Today’s post is from our  SafeSourcing archive

Today, we will look at some of the principles of this dashboard and how you could be using them to help track the health of how your company spends its money.

Establish the baseline – One of the premises with which most dashboards work successfully is that of establishing where you are right now.  Even better than that is being able to go back 1-2 years to see where you have come from.  When you can go back over historical data, you can begin to establish the trends of how you have done and what areas need the most attention.  If a category has consistently increased year after year, then you may need to source a different vendor or item.  Other areas of the company can use this data, too, to determine if a total shift in products or raw materials should be used to get away from those made with material that continues to increase.  The baseline will establish your health before you do anything else.

Pull from other sources – Often times, procurement departments do not have access to the best data they need to make decisions.  This may be because it is held in systems they do not have access to or because the company itself has never had a process to track the details.  By looking to outside sources, you may uncover data that is useful in making decisions, such as going to the suppliers you do business with and asking for historical performance for purchases or pricing.  It could also mean that you research internally for data that isn’t dollars and cents.  You may purchase material handling equipment, but the warehouse uses it.  How the equipment holds up and runs and how the supplier supports you for fixes and replacement parts are just as important in determining your procurement health as is the cost of the equipment in a contract.  The more data you have, the better choices you can make for the company.

Correlating Data Points – With data from several sources, you can put the final piece in play.  Just like the new Apple Health Dashboard can correlate calories consumed from MyFitnessPal and burnt from MapMyRun, to the blood pressure measurements taken from an iHealth wireless device, you should be looking for solutions that can help correlate the key data points you are receiving from external and internal sources.  When you correlate which resource runs projects quickly but with good savings you can begin to examine what they are doing differently than other team members, for instance.  The correlations of savings and the time it takes to realize the savings is just one correlation we can provide.

At SafeSourcing, we can help your company establish a procurement dashboard to monitor your company’s spend health with our SafeDashboard™.  For more information on this tool or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

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Disaster Recovery

May 23rd, 2018

Another hurricane season is approaching.................

 

Today’s post is written by Ivy Ray, Account Manager at SafeSourcing Inc.

Another hurricane season is approaching, and after a record hurricane season in 2017, meteorologists predict there will be between 14 and 18 named storms on the eastern seaboard this season.  There are areas that are still in recovery from the last season.  According to The Weather Company, cooler water temperatures in the Atlantic and warmer temperatures in the Pacific could hamper activity, and result in an average hurricane season with about 13 named tropical storms and 6 developing into hurricanes, with 2 being major.

We can’t fight the forces of nature, but we can be prepared as we enter the hurricane season.  Safety is the initial concern during a weather disaster, but the residual damages can be far reaching. Whether the damages are resulting from hurricanes, wildfires, earthquakes, tornadoes, or blizzards, it could greatly affect business operations.   An event that disrupts your business could actually put you out of business if you don’t have a plan in place. Your organization may not be directly affected by such an event, but your key suppliers and vendors could be.

A disaster recovery plan is essential to keeping your organization running in the case of a natural disaster. It is a good idea to utilize the National Weather Service’s national preparedness calendar as a guide for year-round reminders to identify potential disasters and review your organization’s disaster recovery plan.

Some questions that an organization should keep in mind are:

  • How will your data be affected?
  • Do you have remote systems in place?
  • Do you have backup vendors?
  • Is there a secure alternate operations site?

Disaster recovery involves a set of policies, tools and procedures to enable the recovery or continuation of vital technology infrastructure and systems following a natural or human-induced disaster.  It’s not enough to have the procedures in place; you need to know what’s in the plans to be able to execute them when the time comes.  Have a plan and be ready for action, but most of all be safe!

For more information on how SafeSourcing can assist you in exploring your procurement solutions for your business or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

 

References ————————————————————————————–

  1. http://fortune.com/2018/05/14/2018-hurricane-season-forecast-possible-tropical-storm-in-gulf/
  2. https://weather.com/storms/hurricane/news/2018-04-19-2018-hurricane-season-forecast-the-weather-company-ibm-april
  3. https://en.wikipedia.org/wiki/Disaster_recovery

 

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Procurement and AI

May 22nd, 2018

How does artificial intelligence fit in with procurement?

 

Today’s blog is by Margaret Stewart, Manager of HR and Administration At SafeSourcing Inc.

Artificial Intelligence is a vastly growing field and with huge strides in its advancement, it has become more of a household tool. With technologies like Siri, Google Home, and Alexa, the desire for more AI has increased. AI advancements in business, especially procurement, could make processes easier and more streamlined with your goals.

Many businesses currently use their own in house teams on their procurement efforts. This can pull people away from other pressing tasks essential to business operations. Implementing a procurement team can alleviate those currently taking on that role and provide an expertise not otherwise seen within the company. This can also shorten the amount of time it takes to analyze data, evaluate risk, and implement new processes.

If artificial intelligence is added into your procurement efforts with your procurement partner, these processes could make even further advancements. Indices, risks, and spend management could be analyzed in a matter of moments with the right AI application and platform. This could help your business obtain the supplies, services, and data it needs to run as efficiently as possible without taking time away from other projects, ultimately helping your bottom line.

For more information on how SafeSourcing can help your procurement efforts, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

 

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What can e-Procurement do for you?

May 21st, 2018

What can you take to market with e-Procurement?

 

Today’s Post is by Eli Razov, SafeSourcing Account Manager.

What can you take to market with e-Procurement?  The answer is quite simple, anything you want! I was talking with a friend recently that owns a roofing company. We were just discussing work and the question came up, “do you have any way of sourcing fleet trucks?” I responded with yes we can. We have recently run a Truck Lease event saving our client over 11% based on previous year leases. This grabbed his interest and he began asking a lot more questions. What about supplies, shingles, equipment? The answer of course is yes to all. If you purchase it, we can source it. What started as simple small talk blossomed into a full blown discussion on what we could do to help his business? With our extensive vendor and supplier database we can find the right people for what he needs. We went over a few categories including supplies and equipment.  Based on what he spends now, and the size of his company, we could potentially save him over 23% just on his supplies alone, compared to previous events we have run.

He asked so what is the difference from him just calling all the vendors to get the quotes himself and using an e-Procurement tool such as ours? That can be answered a couple of ways. To begin with, as previously mentioned, we have an extensive vendor list of over five hundred thousand companies for many different categories to which we are constantly adding more. Secondly, by inviting these different companies to participate in a “Live Event” it brings out the competitive nature in companies to want to be the best and offer the best pricing. So by hosting these events, it shows vendors their price, and if they have the lowest quote, gives them the ability to lower their price. Additionally, we do all of the leg work contacting vendors, building specification documents, gathering pricing and giving full event reports. We handle it all, making the procurement easier and less expensive.  On top of that, he has time to work on his business while making it grow without the extra headache of expenses. Needless to say, we will be looking to help him in the near future with all of his procurement needs.

For more information on how SafeSourcing can assist you or on our “Risk Free” trial program, please contact a SafeSourcing Representative we have an entire team waiting to assist you today.

 

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Finding the Right Mechanic

May 18th, 2018

Do you have a good reliable mechanic that you can count on?

 

Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.

Do you have a good reliable mechanic that you can count on for fixing and maintaining your vehicles?  In business do you have the right M&R partners for your fleet? If not, you need to look into finding one as soon as possible and the search can be much the same for business and personal use.  You may be overpaying or using one that is not as reputable as you as think.  It’s a good idea to find a reliable technician before you start having problems with your vehicles.  To start your search you may want to talk to friends, relatives and colleagues and see who they may recommend.  There are also sources available online such as the Better Business Bureau, Angie’s List and by performing searches for places that are approved by AAA.

When you find one that you think you may be interested in, check to see if they have any certifications.  Ask if the mechanics are ASE certified.  ASE certified means that the mechanic went through testing with the National Institute for Automotive Service Excellence and has been properly trained for the position.  Businesses that are certified may be a better option because they have been vetted by another organization.

Once you have found a shop, start out by having some routine maintenance done on your vehicles such as fluid changes.  When the work is complete, see if you are able to talk to the mechanic about the work and any other issues they may have seen.  Talking to the mechanic may help you get a feel for how knowledgeable and trustworthy they may be.  This will also give you a chance to look around and see how well organized and how they keep their shop.

As you know, finding a reliable mechanic takes some work so if you need help finding one, feel free to contact SafeSourcing.   We conduct M&R events several times per year and  can gather all the necessary information for you and help you decide which shop meets your needs.  If you would like more information on how SafeSourcing can help you, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

 

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Getting Started​ ​

May 17th, 2018

Determining how and where to start with eProcurement

 

Today’s post is by Dave Wenig, Vice President of Sales and Services at SafeSourcing.

Years ago, I wrote another blog posting called “Getting Started.” At the time, this topic was among the most common in all of the conversations I had. All this time later, that is still true. While the titles have not been as direct as that first blog, I have written several others that share this theme. Today, I am revisiting this again. In “Getting Started,” we considered some basics which I’ll seek to update here today.

One of the basic points that we considered back in 2012 was the importance of leveraging your eProcurement Services provider as a partner to help establish a plan. This is even truer today than it was then. Like in many fields, constant improvement and innovation has greatly changed the world of Strategic Sourcing. One way that your partner is able to help you develop a plan better today than in the past is through advances in analytics. Offerings like SafeSourcing’s own SafeSpendAnalysis™ which allow for increased visibility into a company’s spend have been vastly improved over the last few years. The insights that tools like this generate fill in enormous gaps in the knowledge that an organization has and also give that organization the tools to create a plan that is based on actionable intelligence. Now, more than ever, you should rely on an experienced partner as you get started.

In the blog from 2012, I also wrote about relying on the experience of your partner as you get started. Along with the tools and the understanding needed to determine your plan, your partner can also help you execute against that plan. A partner like SafeSourcing will have many years of experience to call upon which includes specification templates, suppliers, strategic advice, and more.

In 2012, I wrote that “The next question you will ask is “why didn’t I start sooner?” If you haven’t started yet, I encourage you to do so. In the last several months, I’ve had that exact conversation as our clients have realized the capabilities of eProcurement and have lamented about lost savings opportunity because they sourced products and services before they engaged with us and know they have likely overpaid.

Please contact a SafeSourcing Customer Services Associate for more Information

We look forward to and appreciate your comments.

 

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Should retailers manage their in place contracts with SaaS based Contract Management Offerings?

May 16th, 2018

The answer is a simple yes and if it’s cloud based all the better.

 

Todays post is from Ron Southard, CEO at SafeSourcing.

It is not secret that the majority of global retailers both large and small do not have contract management solutions in place. Nor, do they have document management systems in place. In order to mitigate their risk, where should focus be placed when beginning implementation?

SafeContract™ which is a Software as a Service cloud based offering is the best way to store and leverage the pertinent language or data within existing contracts. What this means is that there is also a need to create a process with which to identify the Metadata within your contracts.

According to Wikipedia Metadata is loosely defined as data about data. Though this definition is easy to remember, it is not very precise. The strength of this definition is in recognizing that metadata is data. As such, metadata can be stored and managed in a database.

When we think about contract management, we need to be thinking about mitigating risk and not necessarily all of the language embedded in a contract. On many occasions this information is listed on addendums or attachments. For sake of simplicity, and this is certainly not an exhaustive list the following twenty items reflect the metadata you might want to hi-lite and set alert targets against in storage of current contracts.

1. Supplier or Seller Information
2. Purchaser or Buyer Information
3. Detail of Goods to be purchased
4. Detail of Services to be purchased
5. Delivery Timeline Details of the Goods and or Services
6. Agreed upon pricing
7. When and where should payments are to be made?
8. Payment Terms
9. Down Payment Terms
10. Delivery Dates
11. Delivery Location or locations
12. Risk of Loss or Damage and transfer language
13. Is Assignment of this Agreement Allowed?
14. Detailed Warranty
15. Trademark infringement language
16. Origination Dates
17. Termination Dates
18. Termination Notice
19. Additional Clauses
20. Signature Details
21. Auto Renewal Language

The above list should be at a minimum the type of data that is considered for your Metadata table for inclusion during the document review process that your SafeSourcing will put in place for you as a supporting service during the early stages of implementation, training and review of your SafeContract™ SaaS cloud based offering.

To learn more please contact a SafeSourcing customerr services representative.

We look forward to and appreciate your comments.

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Print Fulfillment

May 15th, 2018

Optimize your program by finding the common denominators!

 

Today’s post is by Mike Figueroa, Assistant Director of Customer Services at SafeSourcing.

If you aren’t familiar with print fulfillment standard practices, it can be surprising to see how complicated the program can get. In retail, for example, printing can be segmented by uses such as signage, labeling, circulars, mailers, flyers, banners, and promotions. Each of these segments is usually kitted by the print fulfillment provider, who also stores and distributes the final product. However, the whole process is further complicated by the fact that each store in a retail chain will have different needs that may require specific promotions, store address prints, quantities relative to store size, quantities relative to market, or differing departments between stores such as deli, floral, or pharmacy. Therefore, the whole process is typically outlined in complex spreadsheets that breakdown stores, campaigns, print files, costs, logistics, and lead times. Managing this process is a delicate dance between all parties involved, and can seem impossible to negotiate better pricing. However, we routinely see double digit savings in this category from companies who take their programs to market.

The first thing many companies will find when exploring the market for other print fulfillment providers is inconsistency. For example, you may find that you have previously priced a banner from a print company, and find that the fulfillment company you buy that banner through, marks up the cost of the same banner by 40% before freight. Another inconsistency you may find is that you are being charged two different price points for the exact same kind of print/material/color, just because they are in different kits, and you’re already being charged a kitting fee. If you have an agreement that allows you unlimited changes to the print file on any product that doesn’t require a re-tooling, the aforementioned price difference doesn’t make any sense. Now that you’ve found these inconsistencies in price for products with a common denominator, you can structure your RFQ appropriately.

If your program data is captured well within a table, you can use any number of programs to identify and consolidate your print types. For example, do you have the same 8.5 x 11/60lbs/4-color product being used in 8 different kits with multiple price points? Itemize that as ONE product, with the print file and kitting to be communicated post-bid in a master print schedule. Go through the same exercise with all of your activity, and you will find that the complexity of your program can have its volume summarized in a much reduced number of activities.

SafeSourcing has walked their clients through this exercise countless times, and then compressed the pricing through our e-suite of procurement tools. We do the heavy lifting, engage the vendors, and negotiate the pricing on your behalf. Utilizing our expertise, you’ll never have to be subject to costly pricing inconsistencies for your Print Fulfillment needs ever again.

Please leave a comment or for more information on how SafeSourcing can assist your team with your procurement process or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.

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Retailers; are you managing your suppliers or are they managing you?

May 11th, 2018

Are you getting the best products and services for the best price available?

 

In to many cases, for many companies the answer to the question above is who knows on both sides of the relationship. And unfortunately this will not change for many companies.

Historically the primary driver associated with the use of reverse auctions and other related e-RFX tools has been to reduce the cost of goods and services and reduce expense in large part, if a retail company saved money it was deemed to be a successful process for the retailer as well as the awarded vendor. What about the other suppliers? What makes it a positive for them?

Supply base management or the attempt at it is the newest focus area of many strategic sourcing suites. Many vendors do not offer this functionality today; in fact some have trouble describing what it is when asked. Although elements of this functionality exist within a variety of surround type service offerings, no one vendor offers complete functionality in this area today even though they may think they do. A significant reason for this is suppliers concern with the thought of being managed at all because it means giving up perceived control. Additionally, retailers, suppliers nor vendors have agreed as to what the correct Key Performance Indicators (KPI’s) should be or how to collect the data that would allow you to manage them. As these types of tools are developed, the most successful supply base management tools will be those that can manage the largest supplier database to the continual benefit of both retailers and suppliers that participate and compete for their business

This author believes that the most probable result of this process will be a set of automated robust supplier scorecards that monitor and report on supplier performance versus a range of KPI’S that are applied against well-known quality guidelines resulting in a continuous improvement procurement methodology.

If you’d like to know how SafeSourcing can help improve and measure improvement in your e-RFX process please contact us!

As always, we look forward to and appreciate your comments.

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Part II of II. Are reverse auctions a good tool to use in the retail distribution cost plus arena?

May 10th, 2018

Yesterday in part I of this post we discussed why cost plus distributors felt that reverse auctions were not necessarily appropriate for their companies.

 

Todays post is by Ron Southard, CEO at SafeSourcing

Yesterdays post reviewed why and how this author felt that reverse auctions were potentially good for both the distributor and the retailer alike. So just what is cost plus?

According to Wikipedia  Cost-plus pricing is a pricing method used by companies. It is used primarily because it is easy to calculate and requires little information. There are several varieties, but the common thread in all of them is that one first calculates the cost of the product, and then includes an additional amount to represent profit. It is a way for companies to calculate how much profit they will make. Cost-plus pricing is often used on government contracts, and has been criticized as promoting wasteful expenditures.

Once unit level cost has been established for the distribution of products it’s easy to turn that into a percentage and add it to the price of a product coming up with a distributed unit price or category price. The most important part of this pricing exercise for the distributor is to get the distribution costs correct. This can include price of storage, freight, length of travel, driver cost and any number of other costs. This is an area where a distributor can lose a lot of money if they are not very careful.

So, are revere auctions a tool that can help distribution companies?  The answer is a clear yes both above and below the gross margin line. If you like to know more please contact me at ronsouthard@safesourcing.com.

We look forward to and appreciate your comments.

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