Archive for the ‘Uncategorized’ Category

Healthcare companies: You are overpaying for your consultants

Friday, September 17th, 2021

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

 

Of all the different categories we source across the different industries we support, there are a few that stand out as consistently delivering savings well above the 24.8% average we regularly talk about. One such category is consultants in the healthcare industry.

 

To illustrate that point, I’ll highlight an example where we worked with one of our healthcare customers to source their Pharmacy Benefits Manager (PBM) Consultant services using a two phase process. In the first phase, we began with an RFP and in the second phase we finished with an RFQ.

 

During the RFP, we ensured that all of the participating vendors were well qualified to provide the financial audit of their claims, assessing current PBM practices and claims data to ensure that proper and accurate management of the prescription plan is occurring. We also made certain that the vendors were well qualified in other ways such as meeting the criteria outlined by the business for partners. Once we had that initial starting point, we were able to proceed to the RFQ.

 

In the RFQ portion, we saw amazing opportunity for savings. How high was the savings? 70.37%. Over the course of 38 minutes we hosted an RFQ in which 7 of the finalist vendors from the RFP participated and competed to earn the business of our customer.

 

While this example is really interesting, it actually isn’t unique. RFQs for consultant services in the healthcare industry typically yield impressive results well in excess of our 24.8% average.

 

How would you like to enhance the negotiations with your contractors before you engage them for their next audit? Reach out and we’ll be happy to share our thoughts and experience.

 

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 Representative. We have an entire team ready to assist you today.

Essential Service 

Thursday, September 16th, 2021

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

The word essential has seen so much more use in the past 10 months or so. Because of this, many of us have had a chance to stop and think whether we are an essential worker and what that really means. I mention this to help point out that the word can sometimes be subjective.

During the last 10 months, I have had a lot of really interesting conversations with people in all sorts of roles in their different organizations. I have heard a lot about their trials and the new and unforeseen challenges they have faced.

What I have come to see as an outside observer with a wider view of how people approach similar challenges is that it can be hard to see past the challenges that are right in front of us. Here are the top three challenges and why the SafeSourcing’s services are essential even in the face of them.

  1. New and ongoing challenges. While it sometimes feels like we have all settled into the changes we had to make to adjust to the pandemic, the reality is this is not behind us. Staffing issues and ongoing workplace safety concerns take too much attention. But that is actually a reason why you should be working with SafeSourcing. We stay focused on your procurement-related initiatives so you can focus on all the new challenges that you have to face. There is no reason to have to choose between the efforts.
  2. There just are not enough resources. For too many of our customers, they must do more with less. Between layoffs, furloughs, and absences, there is a pretty good chance we have all felt a strain. Here again, SafeSourcing is an extension of your own team. We can assist you, so you do not have to worry about spreading yourself too thin. You will reduce expenses and can use that savings to acquire more resources.
  3. My other responsibilities are higher priorities. Managing your costs directly relates to any of your other strategic responsibilities. Whether you are responsible for sales, HR, IT, or any other role, I guarantee your own goals are in line with managing costs. If you are responsible for growing your company’s revenue, you should also be concerned with improving your company’s gross margin. At the end of the day, everyone in the organization needs to be responsible stewards of its expenses. You keep your eye on your goals and bring us on to keep our eye on your costs.

The main takeaway is that if you can keep an open mind about the benefits of strategic sourcing, you will find that one of the biggest is that it can be a great solution to your challenges both now and in the future.

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.

 

 

He Who Has the Gold or BITCOIN

Thursday, September 9th, 2021

 

 

Today’s re-post with a twist is written by Ivy Ray, Senior Procurement Specialist at SafeSourcing Inc.

Most people are familiar with the phrase, “He who has the gold, or BITCOIN today makes the rules”, believed to be coined by the writers of the comic strip “The Wizard of Id” originally published in “The Dallas Morning News” in 1964 and later became syndicated. The phrase has been commonly used in reference to oil, one of our most lucrative resources. Currently the oil of the digital era is data. Data rules the world and technology is changing our economies, societies and daily lives.

Our personal data is constantly being collected by retailers and service providers that we utilize every day. Initially this practice was designed as an effort to discover the customers’ likes, dislikes, preferences, needs, and goals and then use that information to shift gears to better meet their needs in the future. Also this assists the supplier in retaining customers by creating incentives for repeat purchases. Our data is valuable and we give it freely in exchange for access, or for discount offers and select promotions.

In some cases, it simply gets taken from us by use of Artificial Intelligence (AI) software such as Facial Recognition Systems and Intelligent Virtual Assistant (IVA). Apple’s Siri, Amazon’s Alexa, Microsoft’s Cortana, and Google Assistant are at the forefront, so it’s no surprise that the current giants that “deal in data”, are Google, Amazon, Apple, Facebook and Microsoft. They are the five most valuable listed firms in the world. Amazon has been systematically collecting data from its customers since its inception as a book reseller in the mid ‘90s and now runs a cloud service and it’s the most powerful cloud service in North America. The global intelligent virtual assistants market size is expected to reach USD 25.63 billion by 2025.

Information from marketing campaigns, customer service inquiries, and purchase histories are encoded and used to run predictive analytics, and projections. The data utilized must be based on complete and correct data. If the data is not complete and correct then projections will have limited value. We all create and utilize data daily. Creating quality data the first time saves time and money in the long run.

Although data is an essential tool, it is only as valuable as its quality. Remember the garbage in, garbage out (GIGO) concept, the quality of output is determined by the quality of the input. As Albert Einstein once said, “Not everything that can be counted counts, and not everything that counts can be counted.”

For more information on how SafeSourcing can assist you in exploring your procurement solutions for your business 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.

We look forward to your comments.

 

It is STILL time for cost avoidance

Wednesday, September 8th, 2021

 

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

Last month, I wrote about cost avoidance and the how the impact of avoiding a cost increase can be just as beneficial as creating savings. In reality, I would argue that the difference between cost avoidance and savings is minimal.

We measure savings as current cost (what you’re paying for something today) minus the cost we are able to negotiate using our eProcurement process including an online RFQ Event. If you’ve received a price increase, then you can no longer buy whatever you were buying at your previous price. Because of that, the old price is no longer your current price. Current price defaults to whatever price you can actually expect to pay. That might not seem with pointing out, but it’s very relevant with today’s fast changing prices for things like freight costs, pulp costs, resin costs, and labor costs which will alter the pricing of nearly anything you would buy.

I’m not exaggerating when I say that I have several conversations with customers every single day about rising costs. This week, I heard about price increases in categories such as shelled eggs, salsa, tomatoes, sour cream, and more. I had conversations with some people who still think they haven’t seen this in full effect yet. I’ve had conversations with people who, like me, believe we’ve been seeing this in effect for at least all of this year. We’ve forced back many of these price increases significantly. As one final example of what I mean, here’s a graph from our new SafeSourceIt™ Event graph view that shows a corrugate product RFQ where the incumbent vendor (yellow) had just passed along a price increase that they said was necessary and based on the markets. You be the judge, but I don’t believe that price increase is justified based on the final pricing submitted by that vendor’s competitors (blue, green, orange).

 

 

 

 

 

 

 

 

 

You have the ability to do this too. Don’t keep accepting cost increases and wishing you could create cost reductions. Contact SafeSourcing with your procurement needs and we can help. For more information, please contact SafeSourcing.

 

 

 

.

 

 

What are you and your procurement team looking at? CPI, Inflation, Cost of Goods?

Friday, August 27th, 2021

 

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

So many companies in so many industries are struggling with their supply chain today. Most of the blame is on the Pandemic, supposed government assistance and other calamities such as weather and wildfires. All of these have had an impact that has resulted in poor labor pools and shrinking commodity availability. This has resulted in a historic increase in the Consumer Price Index that looks like it will not slow anytime soon.

The Consumer Price Index CPI in the United States is expected to be 273.16 points by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations. In the long-term, the United States Consumer Price Index (CPI) is projected to trend around 281.24 points in 2022 and 286.59 points in 2023, according to our econometric models. That’s a further 5% increase from where we sit today. So, guess what, your prices for products and services are not going down any time soon. To believe that they are is folly. Waiting for them to or for the markets to stabilize is just not a sound procurement strategy.

However, that is just what many companies are doing. There is a hunker down philosophy until we get this figured out. To me, that is a cop out strategy that supports doing less with less. Less employees, so let’s source less stuff. Let’s stick with current vendors even though they are raising prices almost daily and based on the above numbers will continue to into the foreseeable future.

What’s the answer? It’s pretty simple actually. Augment your staff with companies that have the tools and the knowledge to mitigate your workload and improve your costs and service. Companies like SafeSourcing. Just today I watched a company use our resources to source sanitary wipes. Eleven (11) suppliers participated in the bid. The low supplier offered a cost reduction of 21% on all items. More surprisingly the total of all low quotes would reduce costs by a staggering 36% offering some additional negotiation prior to award. This is in an up market. We see these types of results regularly. Because of our SafeSourceIt™ Supplier Database, we know where the suppliers are that can offer you the  best pricing and best service levels that support your needs. Because we run categories dozens of times in a year, we may well understand current issues in the marketplace better than you do.

So, if you want to keep paying higher and higher prices and charging your customers more and maybe losing some, keep doing things the same way. If you really would like to lower your costs in a historically up market, contact SafeSourcing  because we can help.

Resources

Trading Economics

Are your prices going up too much and to frequently from your Manufacturer?

Thursday, August 26th, 2021

 

Today’s question is from Ron Southard, CEO at SafeSourcing Inc.

What is a fair price increase? What type of margin should your Manufacturer be making? These are tough but fair questions that you should be asking of them every day. So, maybe in some cases it’s time to consider other than single source of supply opportunities. Maybe in other cases it’s time to consider multiple Manufacturers in order to meet your service level requirements. What language can you add to your contracts that ensures that your prices don’t rise? What indices should you be leveraging in order to mitigate in contract price increases?

If you’re interested in keeping your costs in line with reality or maybe even getting better pricing and service, contact SafeSourcing because we have done this many times for many companies in many industries.

 

Sunscreen Recall

Thursday, August 19th, 2021

 

 

 Today’s blog is by Gayl Southard, for SafeSourcing.

For years the general public has been advised to use sunscreen when out at the beach or while enjoying outside activities in order to prevent skin damage.  Recently, Neutrogena and Aveeno have voluntarily recalled their sunscreen products that contain benzene (a cancer-causing ingredient).   According to the National Cancer Institute, exposure to benzene can lead to leukemia and other blood disorders.  CVS Health stopped selling two of their after-sun care products due to suspected toxins. The majority of sunscreens have no problems; however, the following products have voluntarily been recalled:

Neutrogena Beach Defense (aerosol)

Neutrogena Cool Dry Sport (aerosol)

Neutrogena Invisible Daily Defense (aerosol)

Aveeno Protect and Refresh (aerosol)

What in Benzene?  Benzene is a natural compound of crude oil, gasoline, and cigarette smoke and ranks in the top 20 chemicals used for production of lubricants, rubbers, dyes, detergents, drugs, pesticides, as well as plastic, resins and nylon and synthetic fibers according to the US Centers for Disease Control and Prevention.  It is a colorless or light-yellow liquid with a sweet odor.  It is flammable and floats on water.

It is suspected that benzene was a contaminant that made its way into the sunscreen product during manufacturing.  Or it could be a byproduct of the process of making chemicals that companies use to formulate personal care products and sunscreens.

For 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.

References

Sandra LaMotte, CNN, 7/17/2021

 

Where to cut back on spending?  

Wednesday, August 18th, 2021

 

 

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

If you haven’t noticed the price of just about everything has been going up over the past year or so.  Just recently another key inflation index rose significantly as the supply and demand mismatch continues.  The Producer Price Index, an economic measurement of the average change in prices that domestic producers of goods receive for their products in a given country, rose almost 8 percent over the last 12 months.  With everything going up, it is time to start thinking about where and how you can save money.  One way to do this is to cut down on your grocery budget.  According to researchers, the average household family of four is spending over 900 dollars a month.  That comes out to almost 11,000 dollars a year.  There are many ways to cut spending on groceries.  One way is to price compare before you shop by comparing prices using grocery store apps.  You can use the apps to browse their weekly ads and to download digital coupons.  When you go through the checkout and use you reward card the coupons are automatically taken off when the items are purchased.  Below are some other tips to help you save money during these trying times.

  • Get rid of Debt
  • Buy Generic
  • Use Coupons and Cash Back Apps
  • Buy in Bulk
  • Shop Online
  • Get rid of Cable Television
  • Cancel automatic subscription services you’re not using
  • Reduce Energy Costs
  • Pack your Lunch
  • Make your own Coffee
  • Set up your Bank accounts to automatically transfer money from Checking to Savings

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.

 

 

Happy 4th of July Weekend 2021!

Friday, July 2nd, 2021

 

 

images[1]

What does “reducing expenses” mean to you?

Tuesday, June 29th, 2021

 

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

At SafeSourcing, we’re always focused on expenses. Helping our customers manage their expenses and reduce costs is in our DNA. It’s fair to say that nearly every organization we work with also has some degree of their focus placed on expense management too. The degree to which this is true varies, but expenses are usually an area of at least some focus.

These days, the level of focus on expense management and reduction seems to be higher. At least, that’s what we are hearing. We hear several times a day from many organizations that they are really focused on expenses right now. But what does that mean and what are you actually doing about it?

There are certainly many ways that one might decide tackle expense reduction. There are some very severe measures like furloughs and layoffs that, while effective in reducing expenses, have some other wide-reaching negative side effects on your business. There are some more temporary measures that can be taken such as freezing spending in certain areas. This can also be effective in the near-term, but this too has negative consequences.

In these times, measures such as these are being considered and implemented regularly. We see it in the news and we hear it in conversation.

There is another way to manage and reduce expenses, of course. Our readers already know that SafeSourcing reduces costs for our customers while maintaining current specifications and service levels and the cost reductions are not temporary. On average, we deliver over 24% cost reduction across all spend categories. That means that if you work with SafeSourcing to reduce your expenses, the reduction scales as you go. If you source $100,000 using our services, your new expense may be around $75,000 after working with us. If you source $10,000,000 using our services, your new expenses may be around $7,500,000.

Plus, working with SafeSourcing also means you get to hand off the hard work of finding vendors and negotiating new rates which can be very time consuming, especially if you’ve already reduced headcount.

I thought it was a good time to share a reminder that there are options if expense reduction is your new priority.

What does “reducing expenses” mean to you?

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.