A doubleheader with Home Runs and Grand Slams
Today’s post is by Dave Wenig, Vice President of Sales and Services at SafeSourcing, Inc.
Welcome to today’s doubleheader. In this final post in the Baseball Season and eProcurement series, we’ll focus on the two most sought after outcomes of an online Request for Quote (RFQ) Event. In the previous posts in this series, we highlighted some examples of how SafeSourcing customers have achieved and enjoyed hitting singles, doubles, and triples in their RFQ Events. At SafeSourcing, a Home Run is achieved when a customer saves between 20% and 24.99% and a Grand Slam is when savings over 25% is achieved.
Home Runs are excellent. It’s a great achievement to save over 20% on a category. Very recently, one of our customers saved over 23% on their uniform purchases. They worked with SafeSourcing to identify the different types of garments that were required and invited several well qualified vendors to participate in the RFQ. This was good exercise for all parties. In the end, the incumbent vendor was able to retain their business through the process. The vendor participated actively and was the lowest company overall which makes the award of business decision very easy.
As great as a Home Run is, Grand Slams are even better. Any time you’re able to reduce costs for a category by over 25%, that’s very exciting. Grand Slams can also be an eye-opening experience for the customers. Certainly, nobody wants to find out that they have been overpaying by 25% or more for any length of time, but that is essentially what might come to mind when a customer achieves a Grand Slam. The reality is that there are a number of factors that go into why savings levels are often so high and this kind of savings shouldn’t be considered as a negative reflection of the capabilities of the buyer or business owner responsible for the spend. One of the strongest factors that leads to a Grand Slam is the use of the RFQ tool and process. Causing open competition leads to maximum savings. Further, when that competition includes a wider selection of potential vendors, the results are compounded. There are more factors too, but these two are very significant.
One clear example of a Grand Slam that supports these points is in the recent project that we completed for a customer covering their Employee Assistance Program. This project was run in two phases. The first phase was an RFP to validate that the potential vendors were able to provide services as required by the customer and to learn about how the services would be delivered. This was important because the customer already had a partner for these services, but they were not aware of alternative vendors or the capabilities they could offer. Once the RFP was completed, select participating vendors were then selected to be invited to participate in a live RFQ for the same project. This was a critical step. As a result of the process, the customer was able to identify several potential partners to choose from for their ultimate award of business. The lowest offering that was already qualified by the RFP offered a 56% savings. Other vendors also finished the RFQ with similar offers. For the customer, that represents a seven-figure cost reduction. That’s a Grand Slam, and they are very common.
At the end of this series, the hope is that we’ve reviewed enough opportunities and examples to illustrate the following point. Cost savings come in a wide variety of categories and amounts. The common thread between all of the examples is that they were valuable for the customer who benefits from the cost savings. Every organization can benefit from savings like what has been illustrated here. Take a moment and consider if you are achieving results like these yourself.
Contact SafeSourcing, Inc. if you’re interested in learning more about how RFQ Events can help your company advance the bases and achieve savings.