Archive for March, 2018

When should I use a Request for Information or RFI

Thursday, March 8th, 2018

 

Today’s post is from Ronald D. Southard, CEO at SafeSourcing Inc.

I’d like to thank my SafeSourcing associates both past and present for their constant quality input to my posts and whitepapers and upcoming book.

A request for Information (RFI) is a request made typically during the project planning phase where a buyer cannot clearly identify product requirements, specifications, and purchase options. RFI’s clearly indicate that award of a contract will not automatically follow.1

An example for use of an RFI would be if a company acquired a used warehouse that needed to be turned into a distribution center. The facility has some racking installed but needs more. There has not been a defined idea of what layout will be needed to improve the warehouse for DC use, nor what types of rack are needed, how much material is needed, nor how long it will take to install the racking. The existing racking is in adequate shape but it is unknown whether it is safe, placed appropriately, outdated, or even needed in any way. A situation like this often is a good time to rely on experts to provide feedback as to these needs.  The best practice would be to get a minimum of 3 sets of data submissions, but I’d recommend getting 4 to 6, submissions from your requests for information from racking manufactures, distributor, and/or installers.

The higher the supplier count, in an area where you have no knowledge, provides the necessary data to begin to make more informed decisions. With at least 3 submissions it becomes clearer if there are major differences between suppliers and how they operate.  Lead time, outsourcing, geographical coverage are all very important pieces of information to gather from the suppliers at this stage of a sourcing project.

The application of an RFI can be used on new goods for use, re-sale, packaging design, any and all services, software, hardware, equipment of any kind, actually it is limitless as to what you can utilize an RFI for in business.

For more information on how SafeSourcing can help you through the complex minefield of eRFX strategies, please contact a SafeSourcing Customer Service representative.

We look forward to and appreciate your comments.

Resources————————————————

http://www.businessdictionary.com/definition/request-for-information-RFI.html

 

 

 

Here are some additional thoughts on managing overstock and other inventory leftovers

Wednesday, March 7th, 2018

 

Todays post is by Ronald D. Southard, CEO at SafeSourcing Inc..

One of our customers recently mentioned that they were dealing with one of their vendors to purchase back some obsolete inventory.  This is just one of the methods some companies use to move old or excess items they have purchased and today’s blog will be taking a look at a few more.

Vendor Assisted – The example mentioned above is one method of dealing with excess inventory, and is one of the most important methods to consider when negotiating the purchase of new items.  Unfortunately, many companies miss this opportunity until it is too late.  Letting vendors you deal with know they may have an opportunity to buy back you excess inventory up front will many times get more aggressive pricing from them on the new items you are purchasing.

Third party buyback programs – If you are not able to negotiate a deal for your obsolete or discontinued items up front with the vendor, another approach is to contact third party companies who special in purchasing excess inventory at a reduced price and reselling it through their own channels.  Depending on the type of product you are looking to move there will always be companies who will specialize in handling it for you.

Donation Programs – Occasionally the sale of excess or obsolete will either not be possible or will not be not as valued as the tax write-off given when it is donated.  As in the cases above there are many companies who will coordinate the pickup and redistribution to charities that they work with; taking the entire burden of getting rid of the products off of your business and providing you with a tax incentive on top of it.

There are many ways to take care of your excess inventory and as is often the case, the earlier you plan the more options you will have in the directions you can take.  For assistance in finding ways to move your excess, discontinued or obsolete inventory, please contact a SafeSourcing Customer Service Representative.  

We look forward to your comments.

How to Stay Competitive in the Retail Market

Tuesday, March 6th, 2018

 

Today’s post is by Gayl Southard, Administrative Consultant, SafeSourcing.

Target is introducing same-day delivery.  Birmingham, Alabama and South Florida rolled out same-day service on February 1st, quickly followed Alabama, Georgia, North Carolina, South Carolina, and Tennessee. Target plans to have this service in all stores by the end of 2018. “Same-day delivery was at the top of our list when we were thinking about ways to make shopping at Target even easier,” said John Mulligan, Target’s executive vice president and chief operating officer said in a statement.

Shipt, an on-line grocery marketplace retail giant, was purchased in December for $550 million. By using the Shipt app, Target customers can purchase over 50,000 items from Target. Amazon currently dominates 38 percent of all online shopping. Amazon customers are used to speedy service, convenience, and low prices. Target wants to capitalize on this market.

Amazon does offer its own grocery delivery service called Amazon Fresh; however, they scaled back the number of locations it’s offering it once they purchased Whole Foods. It seems people are still willing to go to the grocery store and buy in person. Target is anxious to capture and keep this delivery market. Target will also deliver grocery essentials, home, electronics and other products. By the end of 2019, it will also include all Target’s major product categories.

Enrolling in the Shipt program costs $99 per year. That’s cheaper than AmazonFresh, which costs a $179.88 per year, on top of a $99 Prime membership. The move comes as analysts speculate that Amazon might want to buy Target.1

Allow SafeSourcing to help your business be more competitive with your sourcing needs. For more information on SafeSourcing, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you.

Sources—————————————————————-

1 Ben Popken, Business, 2/1/2018

 

 

 

You can’t just implement another companies SOP when you begin to use e-procurement tools.

Friday, March 2nd, 2018

 

This is an oldie but goodie from our Archives. It’s still pretty true today.

All companies like to throw around the term best practices. Who’s best practice is the question that companies should ask as well as who says these are the best practices. Successful learning organizations don’t just throw the baby out with the bath water when they begin to use new tools. There are procedures your company has followed for years, many of which are necessary and other that need to evolve. There are procedures that your new e-procurement solutions providers support and have used successfully with other companies that may make sense. An integration of these practices that work will become your new Standard Operating Procedures (SOP) as applies to your implementation of e-procurement within your organization.

A Standard Operating Procedure (SOP) is an established process or group of processes that an organization carry’s out in a given situation on a routine basis. These procedures tend to be very specific to the business functional area being impacted.

So, how would you go about implementing e-procurement tools SOP into your organization? Begin by asking your solutions provider and if you don’t get a simple straight forward answer call SafeSourcing.

Don’t throw the baby out with the bathwater.

We look forward to and appreciate your comments.

Don’t lose your well-earned eRFX savings by delaying your Letter of Intent or Contract execution.

Thursday, March 1st, 2018

 

Today’s post is from our SafeSourcing Archives

In today’s post, we will be reviewing some of the issues that could occur when a Letter of Intent (LOI) or a new Contract, doesn’t get executed efficiently after a successful eSourcing RFX.

LOI or a Contract is delayed

When an LOI or a Contract is delayed, the savings identified in the RFX will not start accumulating until the first invoice from the new supplier or the incumbent supplier arrives post contract.  If a Contract is delayed, the RFX Host Company will have to pay the current contracts negotiated terms for products or supplies until the LOI and/or Contract is executed.  Depending on the volume of the items, it could equate to a lot of lost savings.

When RFXs aren’t awarded efficiently

One of SafeSourcing’s many service offerings is identifying historical categories to take to market.  Our goal is to create an RFX calendar that outlines future projects extending at least one year out. We then populate the calendar with past eRFXs that should be reruns due to previously negotiated contract expirations. We then identify upcoming potential spot purchases that are a result of our deep dive with our spend analysis tool into all category spending.  When RFXs aren’t awarded efficiently these rerun dates will change and as a result may cause future issues with the strategic selection of targeted dates for new RFXs. If you slip 5 months which we see way to often, and prices are headed up over 41% of your savings may be lost.

For more information on how we can help your business reduce spending and maintain savings 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 and appreciate your comments