What is the retail procurement lifecycle?

October 5th, 2021

The good news is that it’s the same whether you are sourcing products or services?

 

Todays post is an oldie from our CEO Ron Southard that’s still pretty accurate

If your retail procurement team understands the procurement lifecycle of a product or service it will make its sourcing much more efficient. Ask one of your teammates to explain their understanding of the retail procurement lifecycle to you. You’ll be surprised as to how many different answers you get.

A good place to begin discussing this subject is in the discovery phase of a procurement engagement. It helps to get everyone on the same page. Surprisingly the process which is quite simple as a definition is not any different from when this author first learned it over 40 years ago in the U.S. Air Force.

Typically procurement consists of seven (7) steps. Where the confusion generally enters is that each step can have a process of its own or be interrelated with another step in the process. An example would be the contract lifecycle that easily fits within the negotiation cycle and the renewal cycle. Another might be that information gathering which is the generally accepted first step in the process can apply to multiple issues such as information gathering for the related product or services such as specifications as well as the information gathering of prospective supplier data.

As such, the simple steps to the procurement lifecycle that most individuals generally agree upon are as follows.

1. Information gathering
2. Supplier contact
3. Background review
4. Negotiation
5. Fulfillment
6. Consumption
7. Renewal

Most times keeping this simple model in mind will allow retail procurement professionals to answer the question; where are we in the process when a project gets stalled or off track?

If you’d like help evaluating your strategy, please contact the Safesourcing team to learn more.

 

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