Archive for April, 2019

The Central Procurement Function!

Friday, April 26th, 2019

 

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

As you can imagine the answer to this question could actually be pages in length. However the following is directionally correct based on the question and minus the organizational structure and alignment.

The Central Procurement Function in responsible for the procurement of goods, services and capital projects by an authorized group within a company’s hierarchy. Central procurement in a best case scenario includes the financial decision making authority specific to that procurement on behalf of the entire company for reuse or resale from an approved list of vendors or suppliers. In some cases the budget for a specific spend may reside within another functional area  where central procurement collaborates and negotiates on behalf of that areas subject matter experts but the subject matter experts approve the final vendor selection.  In the case of manufacturing company’s  this function also includes the purchase of commodities used in the manufacture of finished goods.

The central procurement function is typically authorized within a company in order to insure consistency thought-out the organizations procurement process by eliminating the potential negative effects of non-collaborative, non-aggregated purchasing by multiple divisions, departments and other corporate entities that can support rogue or unstructured buying.

Measurements of a central procurement organizations success can differ widely from company to company depending upon where they fall relative to a procurement maturity model. Typically these organizations are measured by overall procurement Key Performance Indicators or KPI’s at the procurement department level that usually includes the following at a minimum.

1.  Percent of spend under management
2.  Price Improvement
3.  Quality Improvement
4.  Safety Improvement
5.  Reduction in Carbon Footprint
6.  Service Level Improvement
7.  Distribution Flexibility
8.  On  Time Delivery Improvement
9.  Supplier Management

Management of these KPI’s is intended to insure that  companies have a defined  processes in place so as to promote a fair and open competitive model for the supplier community that’s  interested in soliciting their business.  This also minimizes the opportunity for fraud and collusion while insuring the best possible product or service is purchased at the best possible price and overall value to the company.

If you’d like to learn more about the central procurement function, please contact SafeSourcing.

We look forward to and appreciate your comments.

Procuring Your Proprietary Product- Part 2

Thursday, April 25th, 2019

 

 

Today’s post is written by Heather Powell, Director of Major Accounts and Special Projects at SafeSourcing Inc.

In this series, the author will work to educate you on how you CAN take your proprietary product out to market. While there are many confusing words associated with proprietary products; such as trade secrets, non-disclosure agreements, trademarking, and many more. The author will break down the meanings and how many of them are in place to protect you and your product.

According to the Merriam-Webster definition proprietary means “something that is used, produced, or marketed under exclusive legal right of the inventor or maker”. It takes patience, dedication and years of hard work to build a proprietary product, especially in a foodservice program, that customers can trust, but not all creators have the patience, desire or aptitude to take on the commitment required.

There are many ways creators make a proprietary product, out of necessity or to satisfy the need of many people. Those who create proprietary foods may start with a family recipe or create something from scratch and family and friends encourage the creator to market the item. Many items come to mind as a food product that is proprietary; Kentucky Fried Chicken famous blend of 11 herbs and spices breading, McDonald’s special sauce, and Oscar Mayer Bologna are just a few of many hundreds of thousands of proprietary products.

It is possible to take your proprietary products out to market for new manufacturers, co-packing needs, or to get better market rates on your ingredients or materials needed for your product. In the next series of procuring your proprietary product, the author will define and discuss the importance of trade-marking.

SafeSourcing can assist you in exploring your procurement solutions for your proprietary product on our “Risk Free” trial program for RFPs and RFQs, 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.

 

 

Retail Store Fixtures

Wednesday, April 24th, 2019

 

 

Today’s post is written by Ivy Ray, Senior Procurement Specialist at SafeSourcing Inc.

Over the past five years, the Retail Store Fixture Dealers industry has grown by 5.5% to reach revenue of $5 billion in 2018. In the same timeframe, the number of businesses has declined by -0.6% and the number of employees has grown by 1.4%.

With the closing of some major retailers, like Toys R Us and Sears, you would think that the opposite would be true, with the used retail fixtures flooding the market from these closed stores. Higher disposable income and stronger consumer confidence is expected to boost retail sales, and increase the demand for retail fixtures. This is also due to brick and mortar retailers reinventing themselves to stay a step ahead of the online retailers.

Visual merchandising is key to staying relevant. Store planning, design, and visual effects are important for attracting customers and enticing them to make purchases. I personally prefer buying online because it is usually cheaper, and I save myself the hassle of making a trip to the mall. I also end up purchasing more than I intended, proving that clever merchandising does what it is designed to do. Some customers still prefer to touch and try on things before buying, which is why in-store shopping remains the most popular buying option, followed by websites and then mobile apps.

The Retail Store Fixture Dealers industry primarily acquires retail store fixtures from manufacturers and resells them to retail industries. The industry includes a wide variety of products, such as showcases and counters; gondola store shelving; glass, wood and plastic displays; display racks; gridwall; slatwall and accessories; forms and mannequins; sign holders; and food and jewelry displays.

For more information on how SafeSourcing can assist you in exploring your procurement solutions 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.

References….………………………………………….

https://www.ibisworld.com/industry-trends/specialized-market-research-reports/specialist-engineering-infrastructure-contractors/construction-building-services/retail-store-fixture-dealers.html>

 

 

Better Business Outcomes

Tuesday, April 23rd, 2019

 

Today’s post is from Alex Borbely, Vice President of Sales at SafeSourcing, Inc.

Over 30 million Americans don’t have access to modern broadband. The Federal Communications Commission announced that it would hold the biggest spectrum auction in U.S. history, aimed at bolstering 5G network deployment. The bidding will see roughly 3,400 megahertz across three spectrum bands auctioned off for commercial use. The auction is scheduled to start in December 2019 and may be the largest in the country’s history. The FCC also stated that there would be more auctions after this one. Three rounds of clock-phase bidding will be held each day at this stage in the auction. The clock auction format being with a “clock phase” that lets participants bid on generic blocks in each Partial Economic Area in successive bidding rounds, followed by an “assignment phase” that allows the winners of the generic blocks to bid for frequency-specific license assignments. Thirty-eight bidders qualified to participate in the auction.

In an auction, the activities are targeted towards researching/inviting suppliers and ensuring that any existing supplier has an opportunity to propose keener prices and better terms. The auction is usually held via e-procurement and has a number of activities concluding with a short time period with dynamic bidding ensuring the pricing moves rapidly downwards. This type of auction provides any number of advantages including:

  • Suppliers are encouraged to bid low and provide good terms in order to win the contract.
  • The process is seen as a fair way of awarding government contracts as well as those from large monopolistic companies.
  • It is a low cost, much quicker method of finding new suppliers.
  • Negotiation costs are almost zero.

SafeSourcing eProcurement, particularly reverse auctions, is a relatively new way to increase your bottom-line and enhance the spend process. Utilizing new technologies will add profit dollars without selling one new customer buying your products or services. The savings are traditionally 10X your investment in e-Procurement tools. You’re just accepting a different way to silicate bids/pricing even with your incumbent vendors that you currently work with.

For more information on how SafeSourcing can help in your procurement efforts, or on our Risk Free trial program, please contact a SafeSourcing Customer Service Representative

 

 

 

 

Pressure Washing Benefits

Friday, April 19th, 2019

 

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

Have you noticed a green tinted staining on the outside of your home or business? If so, you may not know that this could be mold or mildew. This is a very common occurrence if you have vinyl siding. Dirt can accumulate on the siding and this can lead to the mildewing because mildew feeds on dust and dirt. If your home or building is close to trees it may also cause mildewing as well. Another reason for the mildew or mold is excessive moisture or lack of sunlight. Because of this you may notice that the staining may only occur on certain areas of the structure and not the entire surface. Removing the mildew can be very simple to do. One of the most common ways to remove the staining is to have the area pressure washed. There are companies that specialize in pressure washing and can do an excellent job of removing the stains. You can also choose to pressure wash the area yourself. Pressure washers can be purchased from many common retailers and are fairly inexpensive. Deciding to do this can save you money but there are some hazards of doing it yourself. Having the pressure set to high can cause water to seep into the walls of your existing structure causing mold to grow within the structure. So if this is something that you decide to do yourself, make sure to research and read all documentation before beginning the job. Below are other things to be aware of when pressure washing your structure:

  • Risk of electrical shock
  • High pressure water can cause serious injuries to skin
  • Strong spray can throw small objects
  • Water seeping into the attic
  • Siding loosened or damaged
  • Damage to windows and screens
  • Accidental Removal of paint
  • Accidental Removal of mortal between bricks
  • Damages to surfaces

Whether you plan to clean the structure yourself, or hire a company, feel free to contact SafeSourcing.   We can gather all the necessary information for you and help you decide which one 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.

 

 

 

 

 

Feel the Hype!

Thursday, April 18th, 2019

 

 

Today’s blog is by Margaret Stewart, Manager of HR and Administration.

There are a lot of things happening now that have people excited. From first ever pictures of a black hole, upcoming movies and television, your recent money savings or accomplishments, $100m Fortnight championship, to your upcoming holiday plans, there is so much to help you feel the hype. Let us take a moment and appreciate all the work that made these things happen.

Hype: A simple picture, one that would not be recognizable before, has made headlines because it is the first of its kind – an actual picture of a black hole. Not only is it amazing to see and confirms Einstein’s theory of general relativity, but astounding when we consider the efforts put forth to make it happen. Thousands of hours of work, hundreds of thousands of computer codes, millions of light years between us, yet it can and has been observed and photographed. ​

Hype: What’s new to watch? Feel the hype because the final season of Game of Thrones is here and so is the final Avengers: End Game along with other movies in the Marvel Cinematic Universe. On top of that, there are many other highly anticipated movies and series, like the live action Dumbo movie, a return of The Twilight Zone, and Stranger Things. These exciting shows have been in the works for quite a while the time has finally arrived that we can reap the rewards of the hard work of so many.

Hype: If you get hyped when you save money, then here’s news for you. Using a procurement partner, like SafeSourcing, can save you even more. In fact, those who use SafeSourcing typically see 10x ROI. Not only can you save money, but you can get the quality and service you really want from people you may not have known existed. You can feel the hype and see the savings, and SafeSourcing can do the work for you. We will work with your procurement department, buyers, and finance people to help get the results that we can all feel excited about.

For more information on how SafeSourcing can help in your procurement efforts, or on our Risk Free trial program, please contact a SafeSourcing Customer Service Representative. We have an entire team ready to assist you today.

 

 

 

Part II of II. Are reverse auctions a good tool to use in the retail distribution cost plus arena?

Tuesday, April 16th, 2019

 

Todays post is by Ron Southard, CEO at SafeSourcing

Yesterdays post reviewed why and how this author felt that reverse auctions were potentially good for both the distributor and the retailer alike. So just what is cost plus?

According to Wikipedia  Cost-plus pricing is a pricing method used by companies. It is used primarily because it is easy to calculate and requires little information. There are several varieties, but the common thread in all of them is that one first calculates the cost of the product, and then includes an additional amount to represent profit. It is a way for companies to calculate how much profit they will make. Cost-plus pricing is often used on government contracts, and has been criticized as promoting wasteful expenditures.

Once unit level cost has been established for the distribution of products it’s easy to turn that into a percentage and add it to the price of a product coming up with a distributed unit price or category price. The most important part of this pricing exercise for the distributor is to get the distribution costs correct. This can include price of storage, freight, length of travel, driver cost and any number of other costs. This is an area where a distributor can lose a lot of money if they are not very careful.

So, are revere auctions a tool that can help distribution companies?  The answer is a clear yes both above and below the gross margin line. If you like to know more please contact me at ronsouthard@safesourcing.com.

We look forward to and appreciate your comments.

Part I of II. Are reverse auctions a good tool to use in the retail distribution cost plus arena?

Monday, April 15th, 2019

 

Todays post is by Ron Southard, CEO at SafeSourcing

A lot of distributors have told this author that reverse auctions don’t apply to them because they use the cost plus model and as such they just add their price or profit margin on top of the contract price with their source to drive their distributed price.

The fallacy in this thinking is that it may make buyers and category managers lazy in their approach to driving margin within the categories that they manage. This results in a higher price to the retailers they distribute to and ultimately to the consumer or their customers customer. A worst case scenario is that the consumer stops shopping at their customer’s store which reduces overall volume and further increases prices by not meeting volume incentives. It’s a slipper slope.

Off course this argument is relatively easy to overcome when we get around to discussing capital goods and expense related products and services area. These areas have an impact on the distributor’s net profit. And I’m sure that many of you will agree that just because one says they are a cost plus provider does not necessarily mean it’s true in the most pure sense of the definition.

Check back tomorrow and we’ll review what the real definition of cost plus is in part II.

We look forward to and appreciate your comments.

How Fast Can You Change?

Friday, April 12th, 2019

 

 

Today’s post is our archives at  SafeSourcing.

Our CEO Ron Southard has decided to repost this message because if you are not changing you are falling behind. So, how fast can you change? It better be immediately if not faster. And it may be that every associate needs to think of themselves as the agent of change both personally, professionally and for their company. So get cracking because in the time it takes you to read this post you will have lost ground with your competition.

What is intelligence? Encarta defines it as “the ability to learn facts and skills and apply them, especially when this ability is highly developed.” Another definition, famously attributed to Albert Einstein, is “The measure of intelligence is the ability to change.” If we consider the attributes we typically assign to intelligence, we can easily see how they all involve change:

  • Learning requires memorizing new information, which requires a change in the structure of the brain.
  • Someone whose circumstances demand a change in behavior, is not considered intelligent if they never perform the needed change.
  • A business that adapts and reinvents itself in tandem with its changing environment is considered to be very well-led and innovative.
  • In any career, it’s the dynamic and adaptable people who fill top management. Those who are given new directives and take a long time to enact those changes typically don’t gain traction.

If the ability to change is directly correlated to intelligence, then can a lack of intelligence be defined as stagnation? An inability to adapt and change? In short, yes, Dr. Edward Miller, CEO of the hospital

at Johns Hopkins University, stated in a 2005 interview, “If you look at people after coronary-artery bypass grafting two years later, 90% of them have not changed their lifestyle.” It’s been well-established in the medical community that even when the threat is death, the majority of people will not change previously established bad habits. Similar findings have been well established in business management studies. The old-school way of thinking is to assume that everyone just needs more threats, pressure, and dire consequences to get moving. But a one size fits all approach has never worked well in managing human beings. The truth has always been that negative pressure leads to faking change in order to make the boss, the doctor, the spouse, etc, happy with what they’re seeing, even though the truth is performance is still severely lacking.

While some amount of negative pressure will always exist, and will always be essential, what creates long term change is consistent benefit incentives. For example, when people don’t have any hope for the future of their health, their jobs, relationships, etc, adding pressure that says “things are just going to get worse if you don’t change” just adds to the hopelessness of the individual, which they interpret as more reason not to change. However, when someone is given a compliment at work, starts seeing results from exercise, or getting praise from a spouse, they will often see it as a glimpse into something better that is proven to be attainable.

Once we have created the right environment for change, the hard work of implementation can begin. This implementation has to start with paying attention. When a new policy shows up on our desk, we have to take it seriously, read it, memorize as much as necessary, and then change our behavior accordingly. When we see something go wrong, and we don’t change, most people would call that unintelligent. However, when something goes wrong and change happens quickly, effectively, and long-term, we are certainly displaying intelligent behavior. In a world of constant change, the spoils go to the nimble.1

Please leave a comment or 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.

Referances——————————————————–

  1. https://hbr.org/2011/07/adaptability-the-new-competitive-advantage

 

 

Create Small wins for buy-in.

Thursday, April 11th, 2019

 

Today’s post is from our archives at SafeSourcing.

Whether the focus is believing in a leader, a boss (there’s a difference 😉 a spouse, a product, or even themselves, there is a threshold at which a number of perceived failures will begin to cause people to stop believing in certain proposed possibilities. For some people their threshold is very low; all it takes is one setback, one negative comment, one harsh statement from the boss, to get them to lack belief in the viability of a positive outcome. While we can’t pander to everyone’s insecurities, there are ways to start rebuilding confidence, and expanding the perceived realm of possibility for your team.

One such way is to create small wins. A series of small accomplishments for an individual can be a huge bolster to Buy-in. A boss that follows through with his promises is more likely to be trusted when he asks the impossible of his employees. When a leader consistently demonstrates that greater things can be accomplished than what others thought was possible, co-workers will start increasing their self-expectations.

This is one of the greatest differences between incentivizing productivity through negative consequences and positive expectations. You can get people to scramble through fear, but you can’t get them to believe that what you’re proposing is achievable. And study after study has shown that a workforce that believes in a common purpose is always more effective than one that would rather see the project fail because they resent the fear tactics.

Learning what the threshold of buy in is, and consistently exceeding those expectations one step, one “win” at a time, is essential to managing a buy-in paradigm shift. Creating buy- in is what keeps clients patronizing your business; your employee’s following your vision, and your self-confidence high enough to accomplish your goals.

If you’d like to discuss getting your e-procurement program off to a quick start with focused small wins, please contact a SafeSourcing Account Manager.

We look forward to and appreciate your comments.