Archive for August, 2015

It’s all in the Invoices…Literally

Wednesday, August 26th, 2015

 

Today’s post is by Alyson Usserman, Project Manager at SafeSourcing.

During my time at SafeSourcing, I have reviewed hundreds of invoices and compiled an analysis on each set. While evaluating the invoices you can see what the company charged, when they charged it, and why they charged it. All of these details are normal on an invoice; everyone needs to know where the money is going and why. However, we can also see irregularities between what should be on an invoice and what is actually on the invoice.

Typically, there are no surprises hidden within the invoices, the paper trails make up the commercial world. However, what happens when there are issues? What happens when a company is charging far more than the contract allows?

After an invoice analysis we actually compare each line item back to the contract. What is supposed to be charged versus what is actually charged? If the invoicing analysis doesn’t match the contract, then the discussion about taking it out to market begins.

Sometimes when a company has a fragmented and decentralized system they often leave themselves open to risk, including companies overcharging for a service or good. The company overcharging can also hide the hidden fees within other costs, such as labor rates. Every detail on an invoice or purchase order is worth documenting.

At SafeSourcing we work through all of the details so you don’t have to! For more information on how we can help you with your procurement needs 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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Are You Still Printing And Filing Documents in Filing Cabinets?

Tuesday, August 25th, 2015

 

Today’s post is written by Heather Powell, Director of the Customer Focus Team & Project Manager at SafeSourcing Inc

paperstacks

 

 

 

 

 

 

 

 

My co-worker once asked me how many trees I planned on killing one day when I printed a hard copy of a Request for Proposal I had written. I suppose I am “old school” to have paper in hand and make my edits in red pen, then make my revisions to the electronic document, and save those edits in our document management system. Now I have a hard copy in a filing cabinet that, more than likely, no one will ever see and eventually be shredded.

We are a Green company, and I am becoming more cognizant of that by limiting what I print, and save more trees. By utilizing the document management system, the original drafts, as well as all of the edited copies are saved, anyone from our company, at any point and time, can visit those documents and follow the train of thought from beginning to end. It saves time and paper to have those documents accessible.

From our website: www.safesourcing.com

SafeDocument™

SafeDocument™ is a document repository that allows companies to collaborate on documents through an online tool that is a cloud-based SaaS offering available through simple internet access. This tool Provides document sharing and collaboration options where users can organize, edit, protect, and track their documents.

SafeDocument™ includes safety features and controls that enable users to safely share large files across their organization, including the ability to save and recall multiple versions of a document and a notification system that alerts users when changes to the document have occurred.

Implementing SafeDocument™ provides companies with a cost-effective alternative to enterprise content management solutions that is safe and easy to use.

To learn more about SafeDocument™ SafeSourcing can assist you in exploring your document management procedures 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.

 

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Can you repeat that?

Thursday, August 20th, 2015

 

Today’s blog is by Margaret Stewart, Executive Assistant at SafeSourcing.

Many companies use acronyms in their business lingo and their operations. They serve as a way to easily refer to industry terms or provide an easy way to remember longer terms or instructions. Often, those terms are specific to one company or industry, but there are many acronyms that are used across the board in businesses.

First, what is an acronym? Acronyms are, according to Wikipedia, an abbreviation, used as a word, which is formed from the initial components in a phrase or a word. For example, LOL is an acronym for Laughing Out Loud and MLB is an acronym for Major League Baseball.

As most companies use their own set of acronyms, here are a few that are used by most businesses:

CEO – Chief Executive Officer. This is a commonly heard term used by most people, not just businesses. It refers to the person in charge of a company.

B2B – Business to Business. This refers to interactions specifically from one business to another business, like sales or communication. This term distinguishes the transaction as not one involving a customer.

RFI – Request for Information. This is a common term where one company requests information from another company, usually to determine a business’ qualifications in providing goods or services.

RFP – Request for Proposal. This is what a business will send out in order to get proposals on services or goods from another company.

RFQ – Request for Quote. This is what a business sends out in order to receive estimated prices for goods or services.

These are just a few common business acronyms and if you want to find out what 3PL, OEM, PIP, and other acronyms and business terms mean, simply go to our Wiki page. The SafeSourcing wiki is a tool that anyone can use and provides useful information on many common business terms.

For more information on other tools offered by SafeSourcing, or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

http://safesourcing.com/ContactUs/tabid/60/language/en-US/Default.aspx

 

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What can the Amazon Echo do for me?

Tuesday, August 18th, 2015

 

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

There are a lot of gadgets out there that are designed to make your life simpler and fun.  I recently purchased such a device from Amazon called the Amazon Echo.  The Echo is a smart Wi-Fi device that you can give commands, ask questions, listen to streaming music and control other smart devices.  There are seven built-in microphones so that you can talk to the device from anywhere within the room it is located.  A remote control can be purchased separately and can be used for communicating from other rooms within your home.  The interface that is used to communicate with the device is called “Alexa”.  To communicate with the Echo you must first say the wake work Alexa.  The Echo only starts listening when this wake work is heard.

One of the reasons I purchased the Echo was to control appliances within my house.  So far I have purchased and installed two Belkin Wemo Light Switches.  Now I can control the lights in my kitchen and family room by asking Alexa to turn them on an off.  For example to turn on the kitchen lights you just say “Alexa turn on the kitchen lights”.  You can also setup up a group and by saying, “Alexa turn off the downstairs lights“ and it will turn off all of the lights that are configured within the “downstairs lights” group.

Besides home automation, there are numerous things that can be done by communicating with Alexa.
•  Get News Feeds
•  Get Weather Updates
•  Get Traffic Updates
•  Get Sports Updates
•  Create To-Do lists
•  Create Alarms and Timers
•  Check Upcoming Events on Google Calendar
•  Play AudibleBooks from Audible
•  Listen to Music from Various Streaming Services

If you would like some help finding a smart device, we can gather all the necessary information for you and help you decide which device 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.

We look forward to your comments.

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Considerations when Sourcing Globally

Monday, August 17th, 2015

 

Today’s post is by Tyler Walther; Account Manager at SafeSourcing. Tyler details important considerations when sourcing with global suppliers.

According to Wikipedia, Global sourcing is “proactively integrating and coordinating common items and materials, processes, designs, technologies, and suppliers across worldwide purchasing, engineering, and operating locations.” Global sourcing offers many benefits, including lower pricing, quicker delivery times and wide-ranging supply groups. Here are a few factors to consider when sourcing globally.

1. Product Quality: The most important aspect to consider is the quality of the product being sourced. If the quality is subpar or not up to standard, the cost is effectively immaterial. It is important that quality and specification standards are defined so that the supplier and buyer understand and are in agreement. If there are issues with the quality of the product, it is much harder to address with a vendor through different cultures, time zones and geographies.

2. Cost: Assuming the lowest cost is the best route is not always correct. There are other aspects to take into consideration such as transportation, customs and duties, brokerage services (both at origin and destination), banking fees, financing and insurance.

3. Logistical Capability: You must be able to receive the products. What type of international transport is available? Is there reliable transportation infrastructure in the country of origin? Weather and seasonal variations should also be taken into consideration. Events such as the tsunami of 2004, earthquakes and hurricanes can have lasting effects on suppliers located in the affected region.

These are a few factors to consider when making global sourcing decisions. Once an informed decision is made, there is opportunity for profitable business in the global market. We enjoy bringing this blog to you every week and hope you find value in it.   For more information on how we can help you with your procurement needs 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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Paper or Electronic – The Future of Your Documents

Friday, August 14th, 2015

 

Today’s post is from the  SafeSourcing Archive.

Faxes, letters, catalogs, whitepapers, newspapers, and books are all things that are in the process of becoming extinct or have been converted to a newer electronic version of what used to be.  The world has been electronic for decades and will continue to move in a direction where nothing gets printed on paper any more.  Whether you support or fight this trend, it is clear that the management of corporate documents is becoming a top priority as file cabinets become empty and hard drives get full.  Today we will look at some of the key points to developing a strategy for managing your digital documents and some details to keep in mind when looking for third party suppliers who can provide assistance to help you with the task.

Establish the starting point – One of first strategic decisions you will make in managing your documents electronically will be to decide how far back you are going to go in getting old documents converted to digital format.  Historical contracts, agreements, and other legal documents will likely need to be managed in this process but will not always have an electronic format.  Some strategic partners will recommend starting with all documents right now moving forward and develop a phase II strategy of converting historical documents later.  The strategic partner you select may also have a staff of employees and solutions that will allow for an easier conversion path as well.

Storage Location– Where you store your electronic versions of documents is the most important decision you will make for the security and protection of your company.  Your IT department will likely have input to lend on this matter and a corporate policy on sensitive documents will also come into play here as well.  Whether they are stored digitally in a database, as files in a folder structure, on computers within your company or  by a 3rd party, the location of your files and the backup procedures to ensure they are safe are important pieces that will dictate the solution, process or partner you choose.

Workflow integration – Document storage and management are one piece of this process, the other piece will be how those solutions/processes integrate with the productivity tools you are using today.  Many document management systems have links into the major office suites of tools like Microsoft Office that will allow for links into the document management system within the tool you are using.  This makes checking out and editing files by multiple people much easier.  Worklflow aspects of a document management system are very important as the majority of documents will have multiple people all working together on them and the capability for a system to allow this without overwriting existing edits is critical.

Version Control & Audit Trail – Along with workflow integration the capability of a document management system to allow users to lock files for changes, create new versions and to provide audit trails for all edits should be one that is required in any implementation.  Being able to track and rollout back to previous versions of a document is an important aspect to protecting companies in situations that arise years after an activity was conducted.  Automated alerts and change subscription features are other aspects to link directly to version control and should be investigated in any solution you review.

Managing corporate documents should be a top priority for every company and the keys above should be considered when evaluating current processes and new vendors to help with the process.  For more information on how SafeSourcing can assist your team in sourcing Document Management Solutions 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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Part II of II. What type of savings should we see when we source Private Label items?

Friday, August 7th, 2015

 

Todays post is by Ron Southard, founder and CEO of SafeSourcing.

In part one of this post we discussed the fact that the use of e-negotiation tools should be just as beneficial in the private label area as they are in expense related areas. Quite frankly there is no area of the business that should not benefit from modern negotiation strategies and tactics.

The first hurdle that buyers and category managers have to get over is that the benefits are not only related to price. In fact that is a huge measure of success, but not the only one.  Other benefits that are more on the soft side are related to work flow and the amount of work that a category manager, buyer or other procurement knowledge workers can reasonably accomplish when trying to source a specific product or category. That level of reasonableness may in fact lead to unintentional results that are less beneficial to the company in terms of missed quality improvement,  missed pricing reductions and lack of adherence to  other company standards to name a few when sourcing traditionally.

A few questions one should ask when beginning to source a product or category are as follows.

1. Do I have a quality specification for this category?
2. Do I have a list of suppliers outside our incumbents?
3. Do I have clearly defined terms and conditions?
4. How many suppliers can I negotiate or deal wit at the same time?
5. How many individual bids can I receive and respond to during the time it will take me to source this category?
6. How will I consolidate and evaluate all of the responses once received?
7. How will I evaluate all of the marketing rhetoric supplied that has nothing to do with the specification but may hold nuggets of value we may want to explore?
8. Who will schedule sample reviews once I get to a best few decision point?

Even in today’s world with all of the phone, voicemail, text messaging, fax capability and other types of communication methodologies there is only so much one person can listen to, evaluate or respond to.

Here are a few event based statistics of what a quality SaaS based e-procurement eRFQ event or Reverse Auction can provide.

1. From as few as 1 to as many as 6,000 items managed in a single event
2. From as few as 3 to  greater 30 suppliers  managed in a single event
3. Average Length of a typical event is only  31 min
4. Average number of  bids submitted during an average event = to 198 unique bids
5. Average Bids Per Item during an average event = to  23
6. Average number of suppliers in an average event = to 6.
7. Average number of items in an average event = to 40.
8. Incumbent supplier is not the low bid > 50% of the time.

There is no single individual that can accumulate the same amount of data in this short amount of time let alone provide it in a reviewable format that is tailored to making an award decision. The clear advantage here is to the e-negotiation tool.

With all of the above to consider then should buyers try to continue doing this on their own and if they do, will they see the same type of savings as they did when they sourced there expense or indirect categories? The answer is they may see better savings and they won’t know if they don’t try.

In case you need some more ammunition, here’s just a few of the 100’s of examples of what type of  savings results you might see in Grocery and OTC areas.

1. PL Beauty Supplies – 10%
2. PL Vitamins – 31%
3. PL Windshield Washer Fluid – 28%
4. PL Pain Relief – 14.9%
5. P.L. Cotton Products – 7.6%
6. PL Shortenings & Oil – 12%

If you’d like to learn more about sourcing your private label categories, please contact a SafeSourcing customer services representative.

We look forward to and appreciate your comments.

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Part I of II. What type of savings should we see when we source Private Label items?

Thursday, August 6th, 2015

 

Todays post is by Ron Southard, founder and CEO of SafeSourcing.

I was asked the other day if I would share some experience in sourcing private label items in the Grocery and OTC area, and if there were any differences in those areas that might make using e-negotiation tools less effective than traditional negotiation methodologies.

At first I chuckled because the answer is so obvious to me. Then I thought that it obviously is not to others. Further more, greater than 80% of companies still don’t use these advanced tools today even though they have been around for over a dozen years.

The more I continued to think about it, the more the answer did become somewhat complicated. That’s because the answer concerns raw materials, commodities, services (as an example printing) and all the other things that go into making and delivering a product to market that as a private label deliverable is supposed to deliver better margin contribution than a national brand. And unlike the evolution of private label, in today’s world also deliver the same or better quality than the national brand. Additionally the challenge exists to find enough suppliers to provide these products that understand the regulatory concerns for the market being considered. An example might be the U.S. versus the CANADA or MEXICO markets.

The above has to be formulated into a specification that defines the product or products to be delivered in the approved brand format that suppliers can understand. At the same time that specification needs to be unbundled from a bid perspective in order to take advantage of market fluctuations so as to mitigate too much movement in price over a reasonable period time such as quarterly.

With all of the above to consider then should buyers try to do this on their own and if they do, will they see the same type of savings as they did when they sourced there expense or indirect categories? Check back tomorrow for Part II in order to get the original answer before this one became a little more complicated.

If you’d like to learn more about sourcing your private label categories, please contact a SafeSourcing customer services representative.

We look forward to and appreciate your comments.

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Don’t think you can source your construction needs? Think again!

Wednesday, August 5th, 2015

 

Today’s post if  by Heather Powell Director of Customer Services  at SafeSourcing, Inc.

Are you looking for ways to bid a construction job but don’t know how to easily trim costs.  Do you have a favored supplier of your construction materials, but see their pricing is getting higher year after year and you think that you have limited options?

There are couple ways to get your costs down:

First would be to run a request for proposal (RFP) in order to qualify new potential suppliers and their capabilities to support your needs. You will also be able to verify specific pricing relative to materials or to be used during the job.

  • Your RFP should be specific to the project you are working on. As an example, if you are sourcing a new roofing project or replacement roofing, then you could invite local suppliers from the area where the job is to be completed as well as the big national suppliers. Supply all with the same exact detail relative to framing/studs, the type of membrane materials, the insulation type, flashing, piping, ladders, lightning protection etc.
  • From the completed RFP you will be able to choose a primary supplier and possibly a secondary supplier to work with based on their submission of information and pricing within your RFP.

Secondarily you might also run a request for quote or Reverse Auction in order to compress pricing based on all of the specifics submitted through the RFP from the general contractors or run a more specific RFQ targeting the higher pricing from the RFP, which could items such as labor or material costs.

  • As an example, using the roofing scenario, you might choose to run an RFQ on membrane materials only from the manufactures to be used by the general contractor.

By running these e-procurement events you will be able to choose the best qualified supplier with the best pricing as well as present that supplier with your best priced manufacturer of the membrane materials.  The combination of these two types of events will provide you significant savings on two specific fronts within the same category, and resultantly lower your overall construction costs.

The roofing example is just one of many areas within the construction category in which SafeSourcing can reduce costs and aid increasing profitability.

If you would like to learn more, please contact a SafeSourcing customer services representative.

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Do you know how a price index plays into e-procurement best practices?

Tuesday, August 4th, 2015

 

Todays post is by Ron Southard, CEO at SafeSourcing Inc.

From a simplistic perspective an index is a system used to make finding information easier. There are any numbers of indexes or indices available to help procurement knowledge workers insure they are sourcing products at the best possible pricing. The key word here is price as what we will be discussing are specifically price indices.

According to Wikipedia a price index (plural: “price indices” or “price indexes”) is a normalized average (typically a weighted average) of prices for a given class of goods or services in a given region, during a given interval of time. It is a statistic designed to help to compare how these prices, taken as a whole, differ between time periods or geographical locations.

Price indices have several potential uses. For particularly broad indices, the index can be said to measure the economy’s price level or a cost of living. More narrow price indices can help producers with business plans and pricing. Sometimes, they can be useful in helping to guide investment.

Normally an index reflects the current and historical price of a variety of commodities ranging from metals to grain. A common index used in sourcing petroleum products is OPIS or the Oil Price Information Service which you can learn more about by visiting www.opisnet.com.  However in order to drive the best possible fuel pricing there are other dependencies such as whether you are doing spot buys or bulk purchases and these strategies will determine what specific index you would want to review as well as it’s relation to other product information sources such as Platts or the Gulf Coast spot assessments.  This will put you in a better position to determine how to bid the product and also earn a discount relative to the lowest common denominator.

All other commodities have similar sourcing issues dependant on what the highest cost item is in their product makeup. An example here might be the cost of grain in the feeding of cattle or poultry.

Ask you solution provider to explain these tools to you and to recommend how you might use them toward the best outcome.

If you’d like more information, please contact a SafeSourcing Customer Services Account Manager.

We look forward to and appreciate your comments.

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