Archive for the ‘Business Sourcing’ Category

Your Procurement Health Dashboard

Thursday, May 24th, 2018

 

Today’s post is from our  SafeSourcing archive

Today, we will look at some of the principles of this dashboard and how you could be using them to help track the health of how your company spends its money.

Establish the baseline – One of the premises with which most dashboards work successfully is that of establishing where you are right now.  Even better than that is being able to go back 1-2 years to see where you have come from.  When you can go back over historical data, you can begin to establish the trends of how you have done and what areas need the most attention.  If a category has consistently increased year after year, then you may need to source a different vendor or item.  Other areas of the company can use this data, too, to determine if a total shift in products or raw materials should be used to get away from those made with material that continues to increase.  The baseline will establish your health before you do anything else.

Pull from other sources – Often times, procurement departments do not have access to the best data they need to make decisions.  This may be because it is held in systems they do not have access to or because the company itself has never had a process to track the details.  By looking to outside sources, you may uncover data that is useful in making decisions, such as going to the suppliers you do business with and asking for historical performance for purchases or pricing.  It could also mean that you research internally for data that isn’t dollars and cents.  You may purchase material handling equipment, but the warehouse uses it.  How the equipment holds up and runs and how the supplier supports you for fixes and replacement parts are just as important in determining your procurement health as is the cost of the equipment in a contract.  The more data you have, the better choices you can make for the company.

Correlating Data Points – With data from several sources, you can put the final piece in play.  Just like the new Apple Health Dashboard can correlate calories consumed from MyFitnessPal and burnt from MapMyRun, to the blood pressure measurements taken from an iHealth wireless device, you should be looking for solutions that can help correlate the key data points you are receiving from external and internal sources.  When you correlate which resource runs projects quickly but with good savings you can begin to examine what they are doing differently than other team members, for instance.  The correlations of savings and the time it takes to realize the savings is just one correlation we can provide.

At SafeSourcing, we can help your company establish a procurement dashboard to monitor your company’s spend health with our SafeDashboard™.  For more information on this tool 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.

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Disaster Recovery

Wednesday, May 23rd, 2018

 

Today’s post is written by Ivy Ray, Account Manager at SafeSourcing Inc.

Another hurricane season is approaching, and after a record hurricane season in 2017, meteorologists predict there will be between 14 and 18 named storms on the eastern seaboard this season.  There are areas that are still in recovery from the last season.  According to The Weather Company, cooler water temperatures in the Atlantic and warmer temperatures in the Pacific could hamper activity, and result in an average hurricane season with about 13 named tropical storms and 6 developing into hurricanes, with 2 being major.

We can’t fight the forces of nature, but we can be prepared as we enter the hurricane season.  Safety is the initial concern during a weather disaster, but the residual damages can be far reaching. Whether the damages are resulting from hurricanes, wildfires, earthquakes, tornadoes, or blizzards, it could greatly affect business operations.   An event that disrupts your business could actually put you out of business if you don’t have a plan in place. Your organization may not be directly affected by such an event, but your key suppliers and vendors could be.

A disaster recovery plan is essential to keeping your organization running in the case of a natural disaster. It is a good idea to utilize the National Weather Service’s national preparedness calendar as a guide for year-round reminders to identify potential disasters and review your organization’s disaster recovery plan.

Some questions that an organization should keep in mind are:

  • How will your data be affected?
  • Do you have remote systems in place?
  • Do you have backup vendors?
  • Is there a secure alternate operations site?

Disaster recovery involves a set of policies, tools and procedures to enable the recovery or continuation of vital technology infrastructure and systems following a natural or human-induced disaster.  It’s not enough to have the procedures in place; you need to know what’s in the plans to be able to execute them when the time comes.  Have a plan and be ready for action, but most of all be safe!

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 ————————————————————————————–

  1. http://fortune.com/2018/05/14/2018-hurricane-season-forecast-possible-tropical-storm-in-gulf/
  2. https://weather.com/storms/hurricane/news/2018-04-19-2018-hurricane-season-forecast-the-weather-company-ibm-april
  3. https://en.wikipedia.org/wiki/Disaster_recovery

 

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Procurement and AI

Tuesday, May 22nd, 2018

 

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

Artificial Intelligence is a vastly growing field and with huge strides in its advancement, it has become more of a household tool. With technologies like Siri, Google Home, and Alexa, the desire for more AI has increased. AI advancements in business, especially procurement, could make processes easier and more streamlined with your goals.

Many businesses currently use their own in house teams on their procurement efforts. This can pull people away from other pressing tasks essential to business operations. Implementing a procurement team can alleviate those currently taking on that role and provide an expertise not otherwise seen within the company. This can also shorten the amount of time it takes to analyze data, evaluate risk, and implement new processes.

If artificial intelligence is added into your procurement efforts with your procurement partner, these processes could make even further advancements. Indices, risks, and spend management could be analyzed in a matter of moments with the right AI application and platform. This could help your business obtain the supplies, services, and data it needs to run as efficiently as possible without taking time away from other projects, ultimately helping your bottom line.

For more information on how SafeSourcing can help 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.

 

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What can e-Procurement do for you?

Monday, May 21st, 2018

 

Today’s Post is by Eli Razov, SafeSourcing Account Manager.

What can you take to market with e-Procurement?  The answer is quite simple, anything you want! I was talking with a friend recently that owns a roofing company. We were just discussing work and the question came up, “do you have any way of sourcing fleet trucks?” I responded with yes we can. We have recently run a Truck Lease event saving our client over 11% based on previous year leases. This grabbed his interest and he began asking a lot more questions. What about supplies, shingles, equipment? The answer of course is yes to all. If you purchase it, we can source it. What started as simple small talk blossomed into a full blown discussion on what we could do to help his business? With our extensive vendor and supplier database we can find the right people for what he needs. We went over a few categories including supplies and equipment.  Based on what he spends now, and the size of his company, we could potentially save him over 23% just on his supplies alone, compared to previous events we have run.

He asked so what is the difference from him just calling all the vendors to get the quotes himself and using an e-Procurement tool such as ours? That can be answered a couple of ways. To begin with, as previously mentioned, we have an extensive vendor list of over five hundred thousand companies for many different categories to which we are constantly adding more. Secondly, by inviting these different companies to participate in a “Live Event” it brings out the competitive nature in companies to want to be the best and offer the best pricing. So by hosting these events, it shows vendors their price, and if they have the lowest quote, gives them the ability to lower their price. Additionally, we do all of the leg work contacting vendors, building specification documents, gathering pricing and giving full event reports. We handle it all, making the procurement easier and less expensive.  On top of that, he has time to work on his business while making it grow without the extra headache of expenses. Needless to say, we will be looking to help him in the near future with all of his procurement needs.

For more information on how SafeSourcing can assist you or on our “Risk Free” trial program, please contact a SafeSourcing Representative we have an entire team waiting to assist you today.

 

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

Thursday, May 10th, 2018

 

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.

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Starbucks’ $10m Challenge to develop and Eco-Friendly Coffee Cup

Thursday, May 3rd, 2018

 

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

Starbucks is sponsoring a challenge targeting the paper coffee cup. It is the hope that scientists, chemists, or the average tinkerer can develop a paper coffee cup that is compostable, breaking down in such a way that it disappears or can be used as a component in another product.  The problem isn’t the paper cup, it is the lining.

Six-hundred billion paper cups and plastic cups are used worldwide each year. Starbucks reports that coffee drinkers and other customers represent 1%, which is about 6 billion.  The NextGen Cup Challenge was announced in March in conjunction with Closed Loop Partner’s Center for the Circular Economy, which advocates sustainable goods and recycling.  Inventors working on this cup conundrum will receive grants.

This is the first initiative of a global end-to end solution that will allow cups from around the world not to end up in landfills and composted or given a new life as another cup, napkin, or even furniture. Currently Starbucks cups are made with 10% post-consumer recycled fiber.  In 2017, Starbucks began serving their Nitro Cold Brew Coffee with sippable lids, so no plastic straws are needed.  Reusable cups are the best answer; however, any movement to reducing the amount of waste that goes into the landfill is a good thing.

SafeSourcing regularly sources cups and lids. 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.

References—————————————————–

Ziati Meyer (USA TODAY), Arizona Republic, 3/26/2016

 

 

 

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Blockchain

Friday, April 27th, 2018

 

Today’s blog is by Ashley Riviello, Account Manager at SafeSourcing.

If you had invested $1,000 dollars in Bitcoin back in 2008, you’d have more than $40,000,000 today. Bitcoin is based on the blockchain protocol. What is blockchain you ask? Blockchain is a digital ledger in which transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly “we can actually have a look at the blockchain and see evidence of what’s going on.” Blockchain originated in the technology space, which explains slow adoption rooted in its techno-babble jargon.

Marketing and business strategist, Clay Hebert (founder of Crowdfunding Hack), sees a familiar story playing out differently this time compared to how many companies were late to the party when social media emerged. People were very apprehensive about social media, putting your business or yourself out there for the world to see. But it worked, businesses were booming after starting a Facebook or Twitter page. People new about you and everything went viral. “In the mid-to-late 2000’s, big companies missed the social media train. They couldn’t see how Twitter or Facebook would immediately impact their business, so they were slow to adopt these technologies. They don’t want to play catch-up again.” Quoted by CEO of Bitcoin.

This is the same about Bitcoin. People all over are talking about how bad it is or what a scam it is. As Hebert (founder of Crowdfunding Hack) suggests too, we’re already starting to see wider understanding and adoption in blockchain technology from companies big and small. For example:

  • Large consulting firms like Accenture and Deloitte are building out entire blockchain practice areas and developing key alliances in the space.
  • IBM recently forged blockchain collaboration with Nestlé, Walmart, Costco and others to improve global food supply chain safety.
  • Some realtors have begun to differentiate themselves by accepting Bitcoin for real estate transactions (CNBC).
  • The hurdles won’t be overcome overnight. Similar to the Internet itself and social media, blockchain will enable new digital transactions that will disrupt traditional businesses like document authentication and title searches.

Smart companies will build skills around blockchain technology to ensure they are the ones doing the disrupting rather than the ones being disrupted.

Bitcoin is becoming bigger by the day and I say we all get on board fast. The Companies are drastically starting to use it around the world. And it’s a matter of time before its being used everywhere and in every aspect of our financial world.

For more information on how SafeSourcing can help 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.

 

 

 

 

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The Numbers Are In ​

Wednesday, April 18th, 2018

 

Today’s post is by Dave Wenig, Vice President of Sales and Services at SafeSourcing.

The numbers are in, and while this might seem somewhat-braggadocios, 2017 was an incredible year for clients of SafeSourcing. As our readers are probably aware, SafeSourcing offers a wide variety of solutions in the Procure-to-Pay space. This includes our SafeSpendAnalysis™, SafeDocument™, the SafeSourceIt™ suite (electronic RFI, RFP, RFQ), and more. Of all these solutions, it is the RFQ that has always been the most interesting to our clients when it comes to value and ROI.

The RFQ, sometimes called the reverse auction, is a long-time client favorite. In 2017, SafeSourcing’s clients were able to benefit from some very incredible savings through the use of RFQs. Across all of the categories we hosted on behalf of all of our clients in various industry verticals, the average RFQ savings in 2017 was 24.81%.

With this level of savings, it is not hard to imagine exactly why there has been, and continues to be, such interest in the RFQ. As we are now well into 2018, we are happy to report that this trend is continuing and our clients are on track to have yet another big year for RFQ savings.

As we pause to reflect and enjoy this success, perhaps you might reflect as well. There is no reason why you should not enjoy this level of savings. By taking a strategic approach to your own categories, and by leveraging established best practices and the proper tools, this opportunity can be realized.

After reflection, if you feel that your own savings might have room for improvement, we should make time for a conversation.

For more information, please contact SafeSourcing.  

We look forward to your comments.

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What is a price or commodity index and how is it used?

Thursday, April 5th, 2018

 

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

SafeSourcing uses a number of  indices in our sourcing events every day and the same question always comes up from buyers when we do. While this is an older post from our archives I believe you will still find it useful today.

This author has heard a lot lately about prices indexes or indices. Every time we source something we are asked what index should we use. Although there are times when an index is helpful in sourcing in order to manage contracted pricing once a baseline has been determined versus the rise or fall of an index, that is not always the case for every product.

I was reading our local paper today “The Arizona Republic”. In their MARKET TIP on page 3 of the business section they had a nice synopsis of the Consumer Price Index or CPI relative to measuring inflation. It was brief and holds true in terms of how indices are used to measure the rise or drop in prices over time. In your annual contracts you may wish to review them quarterly and have escalator language that locks in price increases or decreases versus a specific index to protect you from volatile commodity markets like the oil market.

According to the Bureau of Labor Statistics website, the Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. The CPI is used as an economic indicator, a deflator of other economic series and as a means of adjusting dollar values. The CPI affects nearly all Americans because of the many ways it is used.

To learn more about how the CPI index is used please visit the Bureau of Labor Statistics website.

If you’d like to learn more about the variety of indices and how they impact the many products that you buy for reuse as well as resale or if you are not in the business of prognostication, please contact a SafeSourcing  customer services account manager.

We look forward to and appreciate your comments.

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Growth in the Internet Has Impacted Our Economy

Wednesday, March 28th, 2018

 

Today’s post is written by Ivy Ray, Account Manager at SafeSourcing Inc.

Toys R Us is closing their doors following a disastrous Christmas season.  Amazon, Walmart and Target all ratcheted up toy discounts during the holidays.  Toys R Us typically does well against the competition between Thanksgiving and Christmas, because of significant inventory offerings and a strategy of selling late at high margins after competitors sell out of ‘hot’ inventory and attracting last-minute shoppers who fear that online deliveries will not be made in time.  This year, however, was different.  As a result of a general decline in toy sales, competitors had full product offerings through the end of the holiday season and same-day and two-day delivery guarantees eased customer fears regarding online shopping.

Toys R Us was once king of the toy castle. In the 1990s, it was the biggest toy seller in the US, expanding rapidly as it pushed out smaller chains. But by 1998, things had changed, and Walmart began selling more toys than Toys R Us in the US.

A winner of the Nobel Prize in Economics, Paul Krugman wrote in 1998, “The growth of the Internet will slow drastically, as the flaw in ‘Metcalfe’s law’…the Internet’s impact on the economy has been no greater than the fax machine’s.”  This seems silly now.  The Internet has had a major impact on our economy, and the shift has had an effect on everything in the marketplace, from home goods, to auto purchases, and to entertainment.

Most brick and mortar stores have had to recreate themselves to stay in business with the internet competition.  Even print media is fighting to stay alive in our internet culture. Change is good, if you’re on the right side of it, or if you know when to get ahead of it.

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—————————————————-

http://www.businessinsider.com/amazon-walmart-target-killed-toys-r-us-2018-3

http://www.digitaljournal.com/article/346996

 

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