Archive for the ‘B2b Supply Chain’ Category

Holiday Thoughts! Will There be Shortages this Christmas?  

Tuesday, September 21st, 2021

 

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

There are rumors that there is going to be supply shortages this coming Christmas.  Because of this, you may expect to pay more for items that you can find.  A recent survey showed that about 82% of retail executives that were surveyed stated that that they were somewhat to very concerned about the shortages.  There are a lot of things impacting the supplies including understaffed factories, record high plastic prices and now there’s a shortage of shipping containers.  Experts say that the Covid-19 pandemic caused a reduction in the number of shipping vessels operating and that has led to fewer empty containers being picked up.  Because of this there are a lot of empty containers stuck at ports for long periods of time.  Also, there is a lot of congestion in key ports within the US which is contributing to lengthening the turnaround time for the containers.  Because of these issues, the time it takes to ship cargo from Asia to the US has almost doubled during the pandemic.  Below is a list of some of the items that may be in less selection and with higher prices.

  • Toys
  • Wrapping Paper
  • Gift Boxes
  • Gift Bags
  • Gaming Consoles
  • Televisions
  • Automobiles
  • Home Appliances
  • Clothes
  • Sneakers
  • Furniture
  • Christmas Trees
  • Meat
  • Candy Canes
  • Paper/Books
  • Actually Everything

Interested in learning how SafeSourcing can help your company run more efficiently?   If you would like more information on how SafeSourcing can help your procurement efforts, or on our Risk Free trial program, please contact a SafeSourcing Customer Service RepresentativeWe have an entire team ready to assist you today.

 

 

Effective Supplier Data Management Improves Procurement Process

Tuesday, July 6th, 2021

 

This may be old, eight (10) years in fact. Its still no less true today then it was then.

The following excerpt is from the above titled article.

There is more to an effective e-procurement program than cost reduction.

While buyers frequently record cost reductions in the range of 30% to 40% when utilizing an e-procurement or reverse auction process, the issues of quality and performance cannot be overlooked.

The foundation for successful e-procurement is the supplier database
that has been developed and is maintained by the e-procurement service provider. Significant time and capital investment goes into the development of an effective supplier database. It provides the buyer with a recognizable advantage in terms of classification of supplier capabilities, historical performance and the quality of the products provided.

The scope, accuracy and functionality of the supplier database are critical components for buyers when using e-procurement. These elements allow buyers to identify the best sources of supply quickly and cost-effectively, oftentimes uncovering alternative sources that were previously not even considered. This is one of the major advantages of including the services of an online reverse auction service provider like SafeSourcing in the procurement process.

Supplier data management is an excellent example of pairing technology advancements with intellectual property to produce an effective, economical support tool that benefits both suppliers and buyers – better pricing, better quality and better sources of supply.

Click here in order to view the entire article.

We look forward to and appreciate your comments.

Avoiding the fallacy of the single cause.

Friday, May 21st, 2021

 

 

Today’s post is from our  SafeSourcing Archives

Procurement projects will of course come in all shapes, sizes, and levels of complexity. Rarely is any single facet of a project determined by only “top-down” variables. Any one part is more likely influenced by a three dimensional layout of different variables, all of which can determine the outcome of the greater whole. But how can all of these intricacies be accounted for, without complicating the project so greatly that it becomes unmanageable? Here are three tips for managing complexity:

  1.  Honestly identify complexity: Don’t close your eye’s to the reality of the project and pretend that it’s simpler than it really is. Admitting that  your value chain is non-linear is not conceding defeat, it’s setting you up for identifying your criteria for success (Be similarly honest with identifying your constraints/bottlenecks).
  2. Consolidate complexity early (accelerated vs delayed differentiation): In supply chains that start with homogenous parts, differentiation should come late in the chain, but the opposite is true for outputs that begin with high complexity. If you consolidate complexity by identifying requirements, scope, and expectations of variables that lead to the single end product, it will keep you from having to break out the constituent parts.
  3. Leverage the entire value proposition: Build into your project the ability to negotiate details based on the full value of the project. For example, make it clear that if a vendor wants to find loopholes that diminish the value of their original quote, that you will be awarding the vendor with the best overall value proposition, not the one who presents a polished picture and adds all manner of hidden fees.

For more information on how SafeSourcing can assist your team with your procurement projects 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.

The Geographical Significance of Vendor Selection

Tuesday, May 4th, 2021

 

Today’s post is the SafeSourcing  BLOG Archives.

Many National companies are faced with the dilemma of trying to control the sourcing of products and services across their company in a way that consolidates what they purchase and helps them control who they are working with.   Many times our customers will tell us that they are only interested in speaking with companies who can handle their entire company; only National providers will be considered.  The SafeSourcing recommendation frequently will be to expand that vision in order to create an opportunity for greater overall value, and possibly better savings.

Today we will be looking at the advantages of each of the three geographical levels that companies can employ when setting up their projects and why a good mix of all three can create greater opportunities for success for your company.

National suppliers – There are some obvious advantages for selecting National providers to be involved with sourcing projects.  As you grow they will have the infrastructure in place to support you and your business.  In many cases they have a support system and reporting system that can assist you with tracking what you are spending and where those products and services are being delivered to.  National suppliers have the size to be able to reduce the overall costs of the items you purchase but they also have the overhead and internal expenses that it takes to maintain a National company.   National companies tend to have larger market share and recognition so their aggressiveness in competing for your business may not always be in line with that of the regional and local suppliers who are looking for any way to get some of your business.

Regional suppliers – Regional suppliers tend to cover 20 to 40% of the country and focus on a specific area such as the Northeast, Southeast, West Coast, etc.  The advantages of the regional supplier are that they are large enough to be aggressive in price and to offer great value-add services but they are focused enough to know the area they are servicing.  Regional suppliers have typically mastered the logistics of their shipping lanes and many times know the culture and the people in the area better than a National supplier does.  While having multiple suppliers loses some of the advantages of having a National program, the services and prices may indicate a 2 or 3 supplier award makes the most sense for the company.

Local suppliers – Local suppliers who handle either a city or an entire state, are typically brought into a procurement event for one of two reasons.   They either are an incumbent of one the locations currently or they are being reviewed for a rural area that is not supported well by a national or regional supplier.  Local suppliers have the flexibility to be aggressive in pricing (especially for services) and they can usually support rural areas better than larger companies.  Having local companies involved gives incumbents a chance to fight for the business they have previously had and possibly win new business and it provides great options for locations that need special attention.   Local suppliers will also ensure that the regional and national suppliers are staying competitive in the service levels, terms and pricing they are offering you across the company.

The mix of suppliers you invite to your sourcing projects are every bit as important as the history and specifications you supply those suppliers and developing a strategy of the right mix will be important to how successful your projects end up.  While you may intend on finding one National provider, the value offered may demand you consider a 2-3 company award at the end and having options at the local level for special situations and emergencies is something every company should have a contingency plan for.

For more information about how we can assist you with developing these supplier selection strategies, 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

Have you ever played liars poker?

Friday, April 9th, 2021

 

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

I was just re-reading some of my old posts and came across this one. You know what? It’s still true!

So, when SafeSourcing in 2021 says it has 5 suppliers (think 5 Aces)  because it does.

Locating, managing and updating supplier information for companies you may choose to do business with has never been more difficult. How many former suppliers from let’s say 4-5 years ago are no longer in business? How many newer companies have evolved or taken their place? I already know the answer you are going to give me. It’s I don’t know.

We keep hearing about big data. What you need relative to suppliers beyond just their name is more data. With new regulatory requirements emerging daily, economies failing, the supply chain shrinking in some places and expanding in others,  changing  safety factors and  environmental factors ( think LEEDS), detailed supplier information and traceability are but a few of the issues that require regular maintenance in order to mitigate a company’s risk.

Solution Providers like SafeSourcing that provide supplier databases (SafeSourceIt™) that are part of automating the procurement process, need to step up and make sure that their data support these changes on a regular basis to the greatest extent possible by providing tools that interact with both regulatory agencies and suppliers  in order to insure consumer safety and environmental impact.
Particularly as more new sources of supply and a continual stream of new products enter the supply chain daily.

Actions that solution providers should take include but are not limited to:

1.  Monitor daily alert data as to product recalls and safety warnings.
2.  Trace warnings back to the original source of supply automatically and maintain history.
3.  Require that suppliers meet certain safety certifications in order to participate in their database.
4.  Require that suppliers meet required environmental certifications or programs in order to participate in their database
5.  Provide a regular purge of suppliers that do not comply with necessary standards.
6.  Validate the entire database regularly for companies no longer in business
7.  Adhere to a strict RFI process for new suppliers requesting participation in your database.
8.  Provide a KPI rating system for suppliers you offer to companies as new sources of supply.
9.  Monitor regulatory agencies such as ISO for new standards and include them as further requirements for suppliers in your supplier databases.
10. Conduct on going category research for evolving new sources of supply.
11. Compare your best customers GL to your database for additions deletions.

Ask your solution provider what their process is to grow manage and maintain their supplier database for your benefit.

If you’d like more information on the SafeSourceIt™ Supplier Database of nearly 500,000 cleansed global sources of supply, please contact a SafeSourcing customer services account manager.

We look forward to and appreciate your comments.

 

Am I really married to my procurement job?

Wednesday, December 2nd, 2020

 

Today’s post is from our archives at SafeSourcing Inc.

My boss always asks me if this is just a job for me or a career that I am committed to.

It was not until I had successfully walked down the aisle and had the perspective of hindsight that I really understood how the disciplines we practice every day at SafeSourcing on behalf of our customers helped to guide the success we achieved in our wedding.

I can tell you that there is nothing more stressful than planning a wedding, especially when it’s your own, and as I’m sure is the case for most young couples, on a limited budget. There are so many things that need to be done for a wedding that you start to lose sight of the big picture. I will give everyone a new pros tip, visit as many catering companies as you can because the free food defiantly helps with the stress!

I’ll bold and italicize some of the steps we followed that correlated directly to my job (err) career.

During the process I figured out that the best way to organize (Strategy) our efforts was to create a lifesaver General Ledger (detail,detail,detail…) that would let me to track everything that we were buying (strategy) for our wedding. My wife and I listed everything (specifications) that we needed to have and started filling in the blanks (research) from there. Key to my success was this organization, and it helped me trim out high price quotes from the equation and pick the best price along with our best impressions (other services) from every vendor we interviewed (double check the data) Better yet, we came in under budget (results).

OMG, it may be subliminal but maybe I am really married to my procurement job.

At SafeSourcing, we have a process that will get everyone’s quotes all in a view that you can easily compare the prices and additional deliverables for purchase. Our reports are easy to follow and assist companies in making their best decision. The vendors in our SafeSourceIt™ Supplier Database are already prequalified to receive your business. For more information on how we can help you with your procurement needs 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.

Thanksgiving and Black Friday is really a story of a supply chain found and developed!

Friday, November 27th, 2020

 

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

Happy Thanksgiving Weekend from SafeSourcing

One hundred and two pilgrims and crew arrived in Massachusetts after a 3,000 mile trip from England on the Mayflower. It is safe to say that as a result of that distance there was no existing supply chain to leverage, so one had to be developed and quickly. This began with basic hunting and gathering and later included trading with the areas indigenous peoples known as the Wampanoag’s for corn, seed and foraging and planting techniques.

The Thanksgiving holiday we celebrate today really stems from the feast held in the autumn of 1621. Since the pilgrims had only arrived on November 21st of 1620 they had really not been there long enough to develop a fully reliable and renewable supply source. They had however established collaborative relationships with the local Wampanoag people who became regular trading partners and who helped them celebrate the colony’s first successful harvest.

The most detailed description of the “First Thanksgiving” comes from Edward Winslow from A Journal of the Pilgrims at Plymouth, in 1621:”Our harvest  being gotten in, our governor sent four men on fowling, that so we might after a special manner rejoice together after we had gathered the fruit of our labors.

The fowl referred to above certainly could have included a wide range of fowl that was plentiful in the area such as wild turkey, pheasant, goose, duck, and partridge and unfortunately by today’s standards even eagles.

The pilgrims probably didn’t have pies or much of anything sweet at the harvest feast because they did not yet have ovens. They had brought some sugar with them on the Mayflower but by the time of the first Thanksgiving, the supply had probably run out.

Their meals also included many different types of meats. Vegetable dishes, one of the staples of today’s Thanksgiving, didn’t really play a large part in the feast. Other items that may have been on the menu certainly included sea food such as clams and lobster, Indian corn, wild fruits and nuts, meats such as venison and seal and certain dry herbs and spices.

The Thanksgiving meal that has today become a national holiday is a symbol of supply chain cooperation and interaction between English colonists and Native Americans.

We look forward to and appreciate your comments.

Happy Thanksgiving.

What is the Government Procurement Agreement or GPA?

Friday, November 20th, 2020

 

 

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

The GPA is a plurilateral agreement within the framework of the WTO, meaning that not all WTO members are parties to the Agreement. At present, the Agreement has 20 parties comprising 48 WTO members. 36 WTO members/observers participate in the GPA Committee as observers. Out of these, 12 members are in the process of acceding to the Agreement.

The fundamental aim of the GPA is to mutually open government procurement markets among its parties. As a result of several rounds of negotiations, the GPA parties have opened procurement activities worth an estimated US$ 1.7 trillion annually to international competition (i.e. to suppliers from GPA parties offering goods, services, or construction services).

The GPA is composed mainly of two parts: the text of the Agreement and parties’ market access schedules of commitments.

There has been some discussion that the current administration would like to pull out of this agreement even though the Is was a founding member.  In an article by Doug Palmer  for Politico and reported on MSN News titled Senators urge Trump not to withdraw from Government Procurement Agreement as there is a belief that it will allow both China and Russia to fill the void created by the US no longer participating.

Please visit SafeSourcing in order to keep up with content the evolution of changes and other educational content that impact procurement professionals and knowledge workers.

References……………………………………………………………………………………

  1. https://www.wto.org/english/tratop_e/gproc_e/gp_gpa_e.htm
  2. https://www.msn.com/en-us/news/politics/senators-urge-trump-not-to-withdraw-from-government-procurement-agreement/ar-BB1bb2zv?ocid=msedgdhp

 

Best Practices to ensure that you have a sufficient supplier community for your eRFX process.

Thursday, November 12th, 2020

 

Todays post is from Ron Southard, CEO at SafeSourcing Inc.

Suppliers can be broken into multiple categories such as Manufacturers, Wholesalers, Distributors, jobbers etc.  SafeSourcing maintains a robust database called the SafeSourceIt™ Supplier Database that consists of greater than 427,000 global suppliers. While this is our primary research facility for identifying suppliers that participate in our eRFX events, we also use other sources such as the Thomas Register, Alibaba, and a variety of Search Engine tools.

While it would be ideal for manufacturers, growers etc. to be the primary participant in an RFP or RFQ, for the most part these companies determine how and to whom they want to take their products to market. In many cases, Manufacturers refuse to go to market directly and often direct us to use their distributors. Quite often they will recommend a couple of distributors because distributors typically have value added services that they want to provide and may bid the base products differently even if they are receiving similar volume discounts. In some cases, there may only be a couple of manufacturers of a particular product. An example in the C-store space is spill bucket liners and drain plugs where historically there were only two manufacturers.

Once we have compiled and reviewed a list of suppliers internally for a category, we review it with our customers who may from time to time have the name of a supplier we are not aware of. Although that is rare. Upon approval from our customers we then send invitations out to the suppliers and await acceptance over a pre-determined period. After that time has expired, SafeSourcing will reach out to all suppliers whether they have accepted or not and encourage all suppliers to participate. We are well practiced at this methodology and do not accept no as an answer. Our team regularly goes through training as to handling objections from suppliers to convince them to participate.

Historically the average number of suppliers participating in eRFX events has been between 5 and 7. That is over many years with categories like hotels or temporary labor that included 100’s of participants. We quite often will have to invite more than the 5-7 average to get that many to accept. Ultimately it is up to the suppliers if they want to bid on our customers business.

Obviously, the number of suppliers we end up inviting, convincing to participate, training, answering questions and hosting increases SafeSourcing’s workload as the numbers grow. As such we have always charged a second event when the number of actual participants reaches 10 or exceeds twenty-line items.

While one may think that the larger the number of participants involved, the better the results will be, that is not actually the case. The spill bucket and drain plug category mentioned above, we have achieved 19.7 percent savings with just two participants and have hosted events with just one participant. Suppliers do not know how many others are bidding in any given event and that is part of the process for them not to know.

While customers may challenge participation from time to time, rest assured that SafeSourcing is continually driving to get as many participants involved as possible.

If you’d like to learn more about working with SafeSourcing, please contact a SafeSourcing customer services associate. Make sure to ask about our risk free trial program.

 

Collaborative Buyer Organizations, Share Groups and Consortiums are evolving in order to compete with mega retailers.

Wednesday, October 28th, 2020

 

Todays post is from Ron Southard, CEO at SafeSourcing Inc.

These business structures have been around for a long time. Many have evolved to use cutting edge e-negotiation and eProcurement tools. Their retailer members are also benefiting from their use of these tools in order to reduce their net landed costs in many different ways.

These types of organization can go by many different names such as wholesaler, collective buyer, consortium, cooperative, share groups and more. They all have one thing in common. They consolidate purchasing volumes for a wide array of groups that may have very similar business structures, but for the savvy consortium can also be wildly different.

In the retail vertical, companies may actually belong to several different buying groups because their primary group does not offer expertise in a certain area.

Consortiums are also evolving and beginning to focus mixed markets where it makes sense. In general consortiums tend to be vertically focused such as a drug industry consortium with the members generally representing the drug industry only. However some consortiums are beginning to market them selves outside of their vertical to retailers or other companies who want to take advantage of learned expertise that the consortium possesses in the categories that are common across more than their own vertical and offer increased volumes. An example might be drug stores sourcing very similar products that health care organizations like hospitals source. Although this may seem like a stretch fro most, it is now very common within retail for non vertical specific players to work together.

Today’s advanced e-negotiation or e-procurement tools make it much easier to accomplish collective buying and aggregating outside of a consortiums initial area of expertise. Large and small retailers alike now have the capability of viewing a much broader universe of suppliers and other companies while also coordinating and participating in collaborative events from hundreds if not thousands of miles away. Suppliers now have an opportunity to earn business they could never compete for in the past.

Retailers should ask their collective buyers how they plan to make the use of these types of tools and what they have to offer in terms of introductions to other companies for increased volume.

If you’d like to learn more about our risk free trial or how SafeSourcing may be of service to you, please contact a SafeSourcing Customer Services Representative.