Traditionalist retailer thinking says e-negotiation tools will never work for them.

November 6th, 2009

Do you ever wonder what it takes to get through to procurement knowledge workers

On many occasions I have discussed the various benefits of using e-negotiation tools with retailers. I still believe that the primary benefit to any retailer if they were to assign twenty percent of their above the gross margin line spend to these types of tools could be an increase in their net earnings of up to 100%.

Beyond an earnings improvement however many of the following benefits could also take place.

1. They would continue to source high quality products.
2. They would continue to have great supplier relationships.
3. They would free up time to do other tasks.
4. They would improve their company’s net earnings by up to 100%.
5. They would support our fragile environment.
6. They would support global food and product safety initiatives.
7. They would have a larger audience of piers to converse with daily.
8. They would have a single source of information about their profession.
9. They would be instantly alerted to product recalls.
10. They would support a traceable supply chain.
11. They would have an endless source of new suppliers to review easily.
12. They would have product specifications at their finger tips.

You might be wondering why many companies are not enjoying these benefits today The following are common objections you might hear daily from procurement knowledge workers that have not been exposed to e-negotiation tools in the past.

1. We already get the best cost.
2. We’ve done business with our supplier for years.
3. We don’t have product specifications.
4. We don’t have time for this.
5. Switching costs will be too high.
6. We can’t insure the same quality.
7. We need to adhere to certain standards.

If you don’t feel that these benefits would support both corporate goals and underlying CSR initiatives, give us a call and we’ll make you a hero and get you promoted.

As always, we look forward to and appreciate your comments

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