An Unfortunate Truth! Most Mid tier retailers are getting further behind by not using e-procurement tools.

August 1st, 2011

This is not based on a lack of desire on the part of mid tier retailers as it is based on large software and consulting providers not willing to price their products or spend time in the mid tier market.

All Retail industry leaders know for a fact that e-procurement improvements can directly improve their bottom line as well as positively impact shareholder and stakeholder equity. In many cases in upper tier companies significant strides have been made to this end.

In  mid tier markets, it’s an  unfortunate circumstance that  procurement departments or purchasing as it had traditionally been known has not evolved significantly beyond its traditional functionality in many cases. Many mid tier companies will introduce you to their category managers. However, it very quickly becomes clear that although many have strong backgrounds as product buyers; very few have been exposed to the most current e-procurement tools available today. This is in no way the fault of the purchasing department or of the retailer. Reduced staff counts and the aforementioned lack of attention from software and consulting providers as well as a lack of near by formal e-procurement training programs combine to make the transition to e-procurement tools difficult.

What can retailers in the mid tier markets do? The answer may be working with boutique software houses that have no where near the overhead of the largest companies in this space. The largest well known companies in the e-procurement space may dominate your web based searches because they can afford to pay for large numbers of key words used in web searches. It may actually pay to drill down a few pages beyond your original search to find companies that have unique e-procurement software offerings that are often developed by highly skilled entrepreneurs that know the retail procurement business and can offer e-procurement solutions for a fraction of the cost associated with the better known legacy providers. The risks associated with this approach are minimal as most offers in the e-procurement space are offered as a hosted service today. All that is required on the retailer’s part is internet access. You might even get treated more like a customer to boot.

We look forward to your comments.

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