Retailers need to think it through before trying a do it yourself program when it comes to e-negotiation or e-procurement

April 7th, 2010

Probably the best way to determine if you can pull off hosting and supporting your own e-procurement program is to look at what it takes to provide a full services program.

This author has met with many large companies that are using e-sourcing suites or tools provided by some of the largest names in the industry. After we have reviewed what we do and how we do it and then compare what they are accomplishing the following question always comes up. Why are you generating significantly higher savings than we are?

The answer is pretty simple in most cases. You have bought a software suite or tools and rather than using them as designed you have just incorporated your old practices into new tools. In addition, further training or access to your supplier’s data in the form of sources of supply etc. was not included in your initial cost.

A full service solution provider should be able to create, execute and support all auction activity including but not limited to the following.

1. Assistance in selecting Auction categories
2. Market insight
3. Determine the timing of category auction
4. Identification of potential quality suppliers in addition to existing
5. Building on-line auctions
6. Supplier contacts and training
7. Execution of live bids
8. Trouble shooting during live bids
9. Compiling and communicating reports within 24 hours
10. Award and Non-Award notifications to Suppliers
11. Providing ongoing customer support
12. Monitoring Supplier performance
13. Feedback from Retailers/Suppliers
14. Analyze the quality of each auction

The above deliverables if not executed in a self service program will result in less than maximum results and potentially failure of your program.

We look forward to and appreciate your comments.

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