How do you know if you are paying too much for a particular item or service
Today’s post is by Steven Belvin, Account Manager at SafeSourcing
How do you know if you are paying too much for a particular item or service? Many companies over the years have discovered they have been paying a vender way too much for an item or service. In some cases, a company may discover that they could be accumulating these items for a cheaper price from their current vender. When trying to determine if your company is paying too much for an item, you will need to keep two terms in mind while conducting your research. Those terms would be Market Value and Total Market Size. The Market Values is the highest price a buyer would pay a vender for a particular good in an open and competitive market. The Total Market Size is defined by the business dictionary as “The number of individuals in a certain market who are potential buyers and/or sellers of a product or service. Companies are interested in knowing the market size before launching a new product or service in an area.” In other words, how many buyer or sellers of a particular product or service are in the market today? That a company will need to know this if they wish to have success with launching a new product or to check the feasibility of continuing to sell a product.
After reading this, it is easy to see where a company could overlook and continue to over pay for a service or good. It is simply too much work to constantly check the market size and the market value. This is where SafeSourcing could be of assistance. We would conduct a supplier research to discover the market size that is available to you and also use our online web tool to discover the Best Market Value of a certain item or service. So if you feel like your company is paying too much for a service, or any items, give us a call and let us review your accounts with you and discover where we could help your company cut back in your procurement process.
For more information on how SafeSourcing can assist your team with this 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.
“What Is Market Size? Definition.” BusinessDictionary.com. N.p., n.d. Web. 16 Jan. 2017.