Archive for the ‘E-procurement’ Category

It’s a real crime that so many companies continue to stay on the sidelines!

Tuesday, August 13th, 2019

 

 

Todays post is from Ron Southard CEO at SafeSourcing

Unfortunately some 70% of companies still do not use eprocurement tools. If they did, their results would be better. SafeSourcing can give you customer references that exceed the 17X ROI mentioned above. So what happens when you combine your spend with another company?

Generally speaking, the greater the spend amount, the more interest you will get from potential vendors. As a result, many of our customers have been turning to collaborative eProcurement events in order to benefit from the additional savings that higher volumes can generate. Let’s take a look at a few of the benefits of getting involved.

1. Higher savings due to aggregate volumes
2. Improved payment terms
3. Larger vendor pool
4. Greater ROI
5. Source smaller category spends

Based on the five benefits listed above, perhaps it’s time to try a collaborative event. You may ask; “how would we become involved?” The answer is simple. Contact your SafeSourcing customer services representative and ask if there are any open or upcoming opportunities in which you could participate. Similarly, if you have any upcoming projects either large or small, ask your partner to attempt collaboration within their customer base.

Here’s an example of savings generated from a recent collaboration. In this scenario, our customer was in need of a relatively small spot buy for replenishment purposes. Their spend in this category was actually quite low and was actually the lowest overall amongst the participating companies. In this example, the customer saved almost 37%. I find it difficult to imagine that they would have done so well without the eProcurement process. Further, this is evidence of the benefits of the collaborative process as their pricing was likely much better off as a result of the aggregated spend.

So, are you ready to get involved, or will you continue to stand on the sidelines?

We look forward to and appreciate your comments.

Believe Me, You could be improving your profitability by up to 73%.

Wednesday, July 10th, 2019

 

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

I wrote this post a number of years ago, and it is still true today. To many CEO’s believe they can have a huge impact in the sales area. Let’s rebrand and we can drive huge top line sales increases! BS. Yup BS. Many have tried and many have failed.

What they should be saying is let’s  MAKE MONEY. We are in business to MAKE MONEY. We can increase sales by focusing on sales. News flash, visit your stores  and  talk to your customers. Watch you associates. It will be come painfully clear what will improve sales.  You do not need to spend millions to rebrand. We can also keep more of those sales increases and reduce historical margins by focusing on reducing costs.

Read on if you want to learn something. Or go find an investor and delay the asset sale for a few more years.

I would  still be glad to personally discuss this premise with any Retail CEO or CFO that wants to challenge it! Let me do it for you. You’ll be surprised and be a hero and get a big bonus.

Let’s review exactly what a reverse auction is, how simple they are to use and the potential financial benefits?

Reverse auctions are web based  or Software as a Service (SaaS) tools that let retailers and other companies find the best suppliers for any resale or not for resale product or service they wish to source.  Using a web based reverse auction tool, retailers, other business or even large holding companies can locate and invite many more suppliers to take place in reverse auctions than they could possibly find or manage using traditional sourcing methodologies or even tools like BING or Google. During the reverse auction they can review on one screen all of the responses from suppliers, data about the suppliers, notes from the suppliers, product specifications and other necessary information in an instant. Upon auction conclusion which is typically less than 30 minutes including extensions host companies can review potential savings scenarios and award business right from their desktop. Sound simple? That’s because it is.

Now let’s get to the simple financial benefits. Let’s assume a $150M smaller Retail Company with industry average earnings of one percent or $1.5M. Additionally cost of goods for this company is 70 percent or $105M. Let’s also assume this company were to only source ten percent of their for resale goods spend or roughly $11M. With well below industry average savings of just ten percent, total savings generated would be $1.1M which is a direct impact to net profitability. If all other segments of the P&L perform to plan and all savings are recovered during the same business calendar year net profitability would increase to $2.6M or a 73% improvement.  Again this assume no tributes to Caesar or other funny accounting associated with new capital plans and the like

So, why don’t many companies use reverse auctions and other e-procurement tools? That’s a great question! Maybe someone out there has an answer.

If this author were you, I just could not ignore this type of opportunity.

If you’d like some examples of the types of savings SafeSourcing can generate for you by size of spend and category, please contact a SafeSourcing customer services account manager.

We look forward to and appreciate your comments.

Honey

Monday, July 8th, 2019

 

Honey

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

There has been a growing concern in the decrease number of honey bees due to pesticides killing them and parasites that get into the hives.

The global consumption of honey is due to exceed 2.8 million tons by 2024. This is largely driven by the growing consumer consumption preference of natural and healthy alternatives to artificial sweeteners. The health benefits of honey range from home remedies such as weight reduction, improved digestion, prebiotic support, acne cure, and a natural exfoliator. China is the largest producer and consumer of honey worldwide.

A few interesting bee facts:

  • Honey bees have pockets in their legs to store pollen called corbiculae. By the end of the day these filled pockets will result in a weight increase of 15%.
  • When it comes time for an older queen bee to be replaced, the worker bees know it and they build new queen cells in the hive. They load the new cells with healthy pupae and flood the cells with royal jelly. They “ball” the queen which means they cluster around her causing her body temperature to rise and she dies. There is only one queen bee per hive. If two are produced, they fight until there is only one survivor.
  • Bees are cold blooded. When the temperature drops below 50 degrees, they can’t fly. Honey bees do not sleep. They remain motionless at night to conserve energy for the next day.
  • The drones’ job is to mate with the queen; however not with the queen in their hive. They travel to other hives. After they mate, they die. They represent 15% of the hive. When temperatures drop in the fall, the drones are kicked out.
  • “Bearding” refers to a form of bees that hang out of the hive (or a cluster of bees) that allow the hive temperature to regulate when internal temperatures get too high.

We look forward to and appreciate your comments. For more information please contact a SafeSourcing Customer Services Representative.

References:

Dorothea Benton Frank, Queen Bee, pp 409-411

http://www.strategyr.com/MarketResearch/ViewinfoGraphNew, 7/3/2019

 

What’s the beef (alternative)

Tuesday, June 25th, 2019

 

 

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

A meat analogue, also called a meat alternative, meat substitute, mock meat, faux meat, imitation meat, vegetarian meat, or vegan meat, approximates certain aesthetic qualities (e.g. texture, flavor, appearance) or chemical characteristics of specific types of meat. Generally, meat analogue means a food made from vegetarian ingredients, and sometimes without animal products such as dairy. Many analogues are soy-based (e.g. tofu, tempeh) or gluten-based, but now may also be pea protein-based. The market for meat analogues includes vegetarians, vegans, non-vegetarians seeking to reduce their meat consumption, and people following religious dietary laws.

A meat analogue looks and tastes like meat from an animal. These products use proteins from plants with fat, coloring and flavoring to replicate poultry, beef or seafood. In some cases these products are used as fillers in meat. There are many companies that manufacture and sell different meat analogue products from patties and ground to breakfast meats and sausages. With growing vegan and vegetarian diet trends more restaurants are beginning to offer meat analogue menu items. That being said more foodservice companies are beginning to explore and offer more product lines offering vegan and vegetarian options. Many of these products claim to taste exactly like their meat counterparts. These products can be found in almost every grocery store and are beginning to pop up in convenience store roller grills nationwide.

Here at SafeSourcing we have a growing database of meat analogue manufacturers and distributors. We work directly with these vendors to help our clients save on these products. With the growing popularity in meat analogue products there is a chance you could be seeing them on your shelves if you haven’t already. Contact SafeSourcing and let us help you save on your meat analogue costs today!

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

References…………………………………………………………

Source- https://en.wikipedia.org/wiki/Meat_analogue

Netflix’s New Audio Platform

Friday, May 17th, 2019

 

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

As a tech enthusiast I get excited when I hear technology news. I recently purchased a surround sound system for my family room that supports Dolby Atmos. For those of you who do not know what Dolby Atmos is, it’s basically an expansion of Dolby Digital 5.1 and 7.1 to include speakers that reside above which adds height to the sound. This technology allows for the sound to be played directly to certain speakers throughout the room. So, for example, when there is a scene of a plane flying overhead and to the left, the sound will start from behind you, then move overhead and then move to the left and fade away. When a scene contains rain, it will sound like the rain is coming from directly above. The reason I am bringing this up is because Netflix just announced earlier this month that they developed and launched high-quality audio. With this new technology they are able to improve the sound quality to “studio quality” audio that sounds closer to what the creators hear within the studio. This results in higher quality audio to all of their content without needing more bandwidth or buffering. If you are looking forward to utilizing this new platform you will need to meet the following requirements:

  • A Netflix Premium plan is required for the Dolby Atmos
  • Compatible Television or device such as Amazon Fire TV Cube
  • Sound System that supports 5.1/Dolby Atmos
  • Watch movies or shows with 5.1 or Dolby Atmnos support
  • Internet connection that supports 5 Mbps for HD and 25 Mbps for 4k/HDR

If you are interested in upgrading any of your electronic devices, 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.

 

 

 

 

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.

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

 

 

 

 

Managing Change While Managing Costs

Tuesday, February 19th, 2019

 

 

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

For our customers, we are primarily focused on delivering cost savings. Generally, in eProcurement, we aim to provide an apples-to-apples comparison so that our customers can make an award decision relatively easily based on the results of an online RFx Event. We do that very well and average over 24% savings. Sometimes, however, our customer is looking to reduce their category costs while also making changes to what it is that they are purchasing.

The good news is that the goals of reducing costs and making a change are not mutually exclusive. While every situation will be different, here is how one customer of ours recently accomplished both goals. The customer, a retailer, knew that they would be phasing out certain plastic products that use regularly. They have a significant annual spend in this category currently. Their goal was to discontinue the use of plastic and switch to alternative products that are more environmentally friendly including biodegradable and reusable options. Because they had carefully planned this change, we were able to develop a plan to work together to manage the change effectively while still taking full advantage of eProcurement tools to reduce costs along the way. Below is a quick summary of how we did this.

  1. Reduce the cost of the current plastic products using a live Request for Quote (RFQ)so they are not overpaying for the remainder of their orders. This generated a substantial savings.
  2. Develop a Request for Proposal (RFP)to attain a better understanding of the specifications, capabilities, and pricing for the alternative products.
  3. Review the RFP results and establish the specifications for the alternative products that would ultimately replace the plastic products.
  4. Host an RFQ to compress the pricing for the alternative products
  5. Test samples for the alternatives, make a decision, and coordinate the roll out of the new products to coincide with the timeline of phasing out the plastic products.

The most important part of this process was the planning. SafeSourcing and the customer coordinated the process and took the steps above in accordance with that plan. In contrast, when we see customers attempt to manage change through the eProcurement process without a plan, we tend to see results that are less impressive. They will likely have savings, and they will likely make a change, but they will not strike the ideal balance between the two.

If you’re interested in learning more about our contract management tool or any of our full suite of Procure to Pay tools,  please contact SafeSourcing

 

 

Understanding the Relationship Between Procurement and Marketing

Thursday, February 7th, 2019

 

Todays post is from our SafeSourcing Archives

The relationship between a retailer’s Marketing and Procurement Departments has been one struggling to maintain cohesiveness in many companies for quite some time.

While the Marketing team is continually trying to find creative and cutting-edge ways to increase sales within a retail organization, Procurement is constantly looking for ways in which to not only reduce costs, but find the best fit of suppliers with their company.

In many cases, marketing will expend a good deal of effort to find vendors to work with them on projects that when turned over to the procurement team can’t even be considered because their price is too high.  In the end this costs the company money, creates continued division between departments, and causes unnecessary lost time and sales.

Studies and reports have shown, and we at SafeSourcing agree, that the involvement of the Procurement department, even at the most basic level, into marketing projects can reap huge benefits as both departments work toward finding partners in their suppliers to achieve both their marketing and procurement objectives.

Retailers whose Marketing departments can leverage the database of the Procurement department’s suppliers will find a positive effect on their spend while achieving the ROI they are looking for on their campaigns and will create a better team environment within the company to achieve like-minded goals.

For more information about how the SafeSourcing database of known suppliers can help your company’s marketing and procurement departments work together to achieve these goals, please contact a Customer Service representative today.

We look forward to and appreciate your comments.

On the Twelve Days of e-Procurement Christmas.

Wednesday, December 12th, 2018

 

Todays post is a holiday favorite by our CEO Ron Southard from our SafeSourcing Archives.

  1. On the first day of Christmas our e-procurement service provider gave to us, a streamlined procurement process.
  2. On the second day of Christmas our e-service provider gave to us, more suppliers to source our goods from.
  3. On the third day of Christmas our e-procurement service provider gave to us, pricing that works for smallest categories..
  4. On the fourth day of Christmas our e-procurement service provider gave to us, consistent and customized product specifications.
  5. On the fifth day of Christmas our e-procurement service supplier gave to us, more time for other priorities.
  6. On the sixth day of Christmas our e-procurement service provider gave to us, improved quality in our products.
  7. On the seventh day of Christmas our e-procurement service supplier gave to us, better supplier education.
  8. On the eighth day of Christmas our e-procurement service provider gave to us, a simple award of business process.
  9. On the ninth day of Christmas our e-procurement service provider gave to us, support for a better carbon footprint.
  10. On the tenth day of Christmas our e-procurement service supplier gave to us, total category e-procurement.
  11. On the eleventh day of Christmas our e-procurement service provider gave to us, safer products for our customers and planet.
  12. On the twelfth day of Christmas our e-procurement service provider gave to us, a sustainable e-procurement process and improved corporate net earnings.

Now, ask yourself if all of these goals are accomplished on your company’s behalf by your present e-procurement service provider. If n0t, please contact a SafeSourcing customer services account manager. Click CONTACT US!

We look forward to and appreciate your comments.

Continued best wishes for a Merry Christmas  the rest of the Happy Holiday Season.