The Benefits of Contract Management

August 1st, 2019

Buyers rely on contracts with suppliers to keep their business going

 

 

Today’s post is our SafeSourcing Archives

Buyers rely on contracts with suppliers to keep their business going. Shippers, vendors, outsourced services and independent contractors all require a high level of contract management system to maintain efficient relationships for their organization. Understanding the impact of poor contract administration on their organization can justify the investment in comprehensive contract management services.  However, one of the biggest pitfalls of not having a contract management system in place is the risk of a contract expiring without the buyer realizing it and thus the buyer being in the control of the supplier to either keep goods and services coming or deliveries just stop since the contract came to the end of the term date.

A contract is drawn up to create the guidelines for a business relationship. When you abide by the terms of the contract, you reap the benefits that it has to offer. But poor contract administration can cause you to violate terms of your contract, which can lead to penalties, fines and a potential lawsuit. Each move made with a contracted entity should be dictated by good contract management to avoid the high cost of the contract penalty clause.

An efficient contracted relationship includes a reporting system that informs both parties of activity performed under the contract. Without this reporting, the two sides have no way of monitoring the benefits of the agreement and developing any changes to make when the agreement comes up for renewal. Effective reporting also keeps track of quantities that helps each side monitor their usage and determine when contract limits may have been met.  Poor contract administration can cause each side of an agreement to lose track of the contract term. Companies can get caught up in the daily routine of doing business and lose sight of contract renewal dates. With a relaxed or no contract management system in place, companies could be operating under expired contracts and not realize it.

Fortune 1000 companies generate an average of 40,000 to 80,000 contracts; less than 80% of retailers have a Contract Management system in place.

  • Today’s Retail Environment
    •  Fragmented Contract Management Procedures
    •  Labor Intensive
    •  Lack of common systems infrastructure
    •  Poor contract visibility/analysis/compliance
  • Regulatory compliance
    •  Contracts dictate supplier-customer relationship
    •  Pricing, Terms
    •  Service levels, Quality
  •  Forcing companies to strengthen contract policies
    •  Document procedures
    •  Track and control financial exposure
    •  Mitigate risk
  •  Sarbanes-Oxley
    •  Every Transaction
      •  Approved/Stored/Reported

How to avoid accidentally extending an expired contract is the key to ensuring that an expired contract isn’t kept on foot is to engage in good contract management. Know your contract and monitor contract performance. Be aware of deadlines and notice period and communicate and document any changes.L

If you are planning to explore the benefits of contract management, feel free to contact SafeSourcing.   If you would like more information on how SafeSourcing can help you with a contract management system, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

We look forward to your comments.

 

 

Prickly Pear Cactus May Solve Plastic Problems

July 29th, 2019

Prickly pear cactus paddles contain large amounts of sugars and gum, making them a good candidate to create “biopolymers”.

 

 

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

The prickly pear is sometimes used as a novelty ingredient in margaritas, or in jelly for Arizona tourists. The microscopic barbs on the paddles can be very painful if you brush up against this cactus. Researchers at a university in Mexico have developed a way to turn the pulp from the paddles into a biodegradable plastic. This could not have come at a better time as plastic pollution has reached epic proportions. The Great Pacific Garbage Patch (a floating mass of plastic) is now larger than Texas, California, Arizona, and New Mexico combined!

Plastic breaks down and eventually is consumed by marine life. An autopsy of a washed up whale in the Philippines revealed 88 pounds of plastic in its stomach. Humans also ingest roughly 50,000 microscopic pieces of plastic each year.

Prickly pear cactus paddles contain large amounts of sugars and gum, making them a good candidate to create “biopolymers”. Corn has been used for a long time in creating polymer products to make biodegradable spoons and cups. Corn, however, leaves a big carbon footprint when you consider the water, fertilizer, and energy used to grow and harvest it. The prickly pear cactus, however, requires very little water. More research has to be done in order to bring this to market.

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.

References………………………………………………………

John D’Anna, AZ Central, 7/9/2019

Sourcing Music

July 26th, 2019

Commercial music licensing basics

 

Today’s post is from our  SafeSourcing Archives

There isn’t an organization on earth that doesn’t use music for its business in some capacity. Offices without any background music are awkward, phone lines without hold music makes customers think no one is actually holding for them, and video marketing is incomplete without song. Even though you may feel that the latest hit would be a perfect fit for your multimedia needs, without following the right procedures you could be on the hook for damages much larger than the actual licensing fees. But where do you start?

The rights to any musical composition’s distribution are typically managed by the publishing company under what are known as “mechanical licenses”. Sometimes the rights can be released directly by the copyright holder, but typically only under special circumstances such as when the request comes from a source with strong cross-promotional influence, or a friend of the artist themselves. The major Performing Rights Organizations (PROs) are ASCAP, BMI and SESAC. All commercial artists will be affiliated with one or the other organization. However, obtaining a license to use the music of one organization does not give you legal access to the libraries of all three PROs. There are, however, several third party companies who have licensing agreements with the PROs, and will grant access to specific works within their libraries for a fee. If you need to be able to customize how you use the creative work, such as by editing a song to fit within a TV commercial or radio jingle, obtaining licensing through a third party is usually the easiest way to go. However, if all you need is elevator music, obtaining licenses specific to your organization is probably unnecessary.

Typically, the best route for a company to take is to purchase systems with pre-existing music libraries already integrated. For example, many VOIP providers either have their own content created exclusively for their organization, or have purchased rights to creative works themselves. This places the burden of working through the licensing issues on the service provider you are using. However, if you want to make sure your service provider is compliant, you should ask for documentation proving compliance with current copyright laws identifying the corresponding PRO.

Please leave a comment or for more information on how SafeSourcing can assist your team with your procurement process 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.

 

Creating our own limitations.

July 25th, 2019

You've heard your limits are self-imposed?, but you'd be amazed how far we can extend those self-limitations.

 

 

Todays post is from our SafeSourcing Archives.

Opportunities to learn are everywhere but can be used either to improve or damage your capabilities. For example, any married couple knows it’s not easy to have two flawed individuals share life together. However, even in less than ideal situations, there are opportunities to learn that you will never get anywhere else other than a situation where someone’s soul is borne to you in ways neither individual can hide from. There will be opportunities to learn how others think and operate, and to discover your own biases and shortcomings. However, there will also be opportunities to hide your insecurities, deny your flaws, blame shift, and stubbornly hold fast to your own LIMITATIONS. This is typically what people do when meeting viewpoints different from their own: We get defensive, myopic, and squander an opportunity to better ourselves.

Whether we like it or not, character traits like humility, and work ethic, will profoundly influence how well we perform our professional activities. No one promoted this fact more heavily than the author of. The 7 habits of highly effective people.

Stephen Covey proposed that maturity is a continuum from least to most mature by the steps of Dependence (reliance on others), to Independence (reliance on self), to Interdependence (Independently chosen reliance on others, to accomplish cooperatively what we cannot independently). This is counterintuitive because we typically think of Independence as being the most mature, in the form of the lone wolf leader, or the maverick who does things his/her way. But the truth is it’s far more difficult and beneficial to assume someone else might know something you don’t. By definition, this means you have to let other people make decisions out of their unique perspective and expertise that you WOULD NOT, or else you’ll always be LIMITED by your own understanding, and no organization will ever be all it can be without utilizing the collective expertise of the group.

Are your limits strictly determined by how hard you work? How fearless you are? How smart you are? What if you’re limiting yourself by making assumptions about how much value other individuals or organizations can contribute to your business? Do we have the strength of character to admit there are individuals or organizations that can perform certain tasks better than we can? Leaning on other’s expertise isn’t an insult to your capabilities; it’s a means of interdependent improvement.

There are variables in our lives we genuinely can’t control, and we shouldn’t want to, especially when it comes to learning through how we work and relate with other people. If we truly want to extend beyond our current limits, we have to allow external factors to force us to explore outside of our current paradigms, and deliberately chose to EXPAND, not LIMIT, our understanding through it.

For more information on how SafeSourcing can assist your team with this process 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.

 

Customer Satisfaction vs CRM!

July 24th, 2019

According to a CEI Survey, 86% of buyers will pay more for a better customer experience.

 

 

Today’s post is written by Ivy Ray, Senior Procurement Specialist at SafeSourcing, Inc.

According to a CEI Survey, 86% of buyers will pay more for a better customer experience. But only 1% of customers feel that vendors consistently meet their expectations. Increasing the percentage of consistently happy customers by 5% goes a long way in retaining customers. Many organizations utilize Customer Relationship Management (CRM) solutions to maintain customer communications.

There is a rise in the use of CRM solutions for a number of reasons. Initially, the CRM industry was primarily geared towards sales and public relations and offered a way to store customer information and track communication with customers. Currently, CRM solutions cover several areas of business, including customer relationship management, marketing, analytics, communication, and even project management. Some CRM systems even have built in chatbot and calling capabilities, so organizations can communicate with clients directly in the system.

Even small businesses can afford to invest in customer relationship management software, due to the increase of affordable SaaS solutions, which delivers functionality without the complication of a major software implementation project. Tiered pricing structures and lots of competition means small businesses have a variety of CRMs options that optimize the customer relationship management process.

From the dozens of CRM systems available, depending on what you would like to track and how your team works, you will find everything from expensive apps you run on your own servers to customizable web apps with dozens of plans and features, to the simple contacts apps. The main point is CRM should work for you, not the other way around. An over complicated and over customized CRM is just as bad as having no CRM at all. The most common features are:

  • Contact Management
  • Account Management
  • Order Management
  • Opportunity Management
  • Sales Process Automation
  • Campaign Management
  • Customer Segmentation
  • Call Center Automation
  • Service Automation
  • Task Management
  • Partner Management

In this automated environment, there are many ways an organization can communicate with their customer. While CRM solutions help to manage information and data, ultimately, nothing can replace “real” customer relationships. Knowing your customer is the best way to meet their needs and improve the customer experience.

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.

We look forward to your comments.

References………………………………………………………………..

  1. https://www.forbes.com/sites/christinecrandell/2013/01/21/customer-experience-is-it-the-chicken-or-egg/#66bcd5793557
  2. https://selecthub.com/customer-relationship-management/crm-features-functionality-list/

 

 

 

Procuring Your Proprietary Product- Part 5

July 23rd, 2019

How You CAN Take Your Proprietary Product Out To Market.

 

 

Today’s post is written by Heather Powell, Director of Major Accounts and Special Projects at SafeSourcing Inc.

Reminder of what proprietary foods are: those which are not standardized under regulations and may contain primary ingredients and some generic additives. For examples, energy drinks and custard powder which contain starch, dextrose, flavor and color. These foods can be made from milk or milk products, from carbohydrates, with or without a basis of milk, from meat, fish, or eggs, from vegetables, fruits, or nuts, and sometimes from fatty substances.1

So why would you expose your proprietary food item to potentially be copied or even the recipe stolen?

You will have the opportunity to grow your business, your bottom line, and depending on how hands on you are with your product will be added time. Some people have the opportunity to take out parts of their proprietary recipe to bid. What are the most expensive items you purchase to make your product? Are there items that have pricing tied to a market index? Do you just go to a wholesale club or foodservice provider for your ingredients?

Looking at your spend and looking at your savings opportunity may open the opportunities for you to engage suppliers in a bid. In many summer salads, mayonnaise is a key ingredient. Do you have a flavor profile preference? Do you prefer a specific brand? Did you know that you can take your specific requirement to bid? Many of the major manufactures of mayonnaise have participated in online request for quotes through SafeSourcing and our clients have received an average of 20% savings from their preferred brand or flavor profile of mayonnaise.

Determine your item(s) you want to take to market and the volume or quantities you will need, be prepared to have the discussion of a 1-year agreement with no price increases versus a 2- year agreement with an index escalator/de-escalator percentage added. You will also need to provide current pricing, purchase history, invoices, or past contracts to your e-procurement company. Where do you store your item(s)? How often is it shipped to your location? Is freight included or added to your pricing? All of these details will make sure your needs, wants, and expectations are met throughout the process.

In the final part, part six of this series, the author will provide the details of why it is important to test and sample the proprietary product before signing that final contract. Meanwhile, SafeSourcing can assist you in exploring your procurement solutions for your proprietary product on our “Risk Free” trial program for RFPs and RFQs, 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. www.quora.com/What-is-proprietary-food

Using Uniforms as a Marketing Tool

July 22nd, 2019

I have currently been working on a project for a client at SafeSourcing for Uniforms/Workwear.

 

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

I have currently been working on a project for a client at SafeSourcing for Uniforms/Workwear. This category can range from just plain tees, to aprons, to work boots. Many places in the US require that employees wear certain attire to work. It keeps the workplace looking unified and also places a nice role in free marketing. You can actually use your employee’s uniforms as marketing for your company. If a customer is already in your store or office, they’ve probably already chosen your brand. However, decking out all your employees in uniforms will give a look or professionalism and cohesiveness that will impress visitors and clients. Additionally, putting all your employees in the same or similar work uniforms will make them easily identifiable in your store. As such, customers will have an easy time finding someone to answer questions, help with a sale, or generally improve their experience in your facility. Anything to improve the customer experience is a positive marketing tool.

However, if you don’t have an office or maybe not a place where customers come to you, having work uniforms with a logo or your company name can get people’s attention. Every person your employee interacts with while wearing a branded uniform is a person that you’re advertising to, essentially for free. In a method that’s approaching subliminal advertising, this is a subtle and easy way to increase your marketing capacity. When you’re out and about grabbing lunch or running errands and you wearing your uniform, people notice. Weather they ask you about it or not they see your logo and your company name and they think about it next time they may need that service.

According to Market Watch workwear/uniforms is expected to grow 4.3% over the next five years, will reach 72,900 million US$ in 2023, from 56,700 million US$ in 2017, according to a new study. That is a huge opportunity to come up with a logo or something that people will be drawn to. Even if your company does not have uniforms, buying t-shirts for your employees to wear outside of work, gets the name out there and gets people talking and asking. It takes no effort and no time. It’s an easy marketing tool and trust me employees love free T-Shirts.

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

 

References…………………………………….

https://www.marketwatch.com/press-release/workwearuniforms-uniforms-workwears-market-2019-industry-demand-share-size-future-trends-plans-growth-opportunities-key-players-application-demand-industry-research-report-by-regional-forecast-to-2024-2019-07-01

Sourcing Green

July 19th, 2019

Are you looking to source Green?

 

 

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

Many of us have noticed the global effects of climate change more and more. Pictures of polar ice caps disappearing, the Great Barrier Reef dying, honey bees being few and far between, and record high temperatures breaking everyday are just some of the things we are facing. So, what can each of us do to help slow the damage?

Individually, we can try to consume and waste less. Home recycling has grown in availability and helps to lower the amount of waste sent to landfills and helps reduce the amount of plastic waste polluting ocean life. In addition, we are now able to use more energy efficient machines and lights in our homes. This helps reduce the amount of fossil fuel energy needed and even lowers our utility bills. So, what about our organizations?

Businesses often take the lead in their help combatting climate change. So, what are some things they can do? For one, many retailers are switching from single use plastic bags to reusable bags. These bags will help reduce the amount of bags needing to be made, reducing energy needs, and reduce the number that wind up affecting the ocean life directly. In addition, many companies are also switching from single use plastic bottles and utensils to biodegradable products. Some can be made from hemp, avocado seeds, and even corn and can degrade into the earth in comparably short amounts of time compared to the plastics currently being used. Not all companies have implemented these measures, so what can you do?

The first step to using greener products is to source them. A procurement partner, like SafeSourcing, can help your organization every step of the way, from identifying what options are available to implementing a change with continued support throughout. We can help your own team source the products and services that can help reduce our carbon footprint and can save money while doing so.

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.

 

 

 

 

Baseball Season and eProcurement Part 4

July 18th, 2019

Hitting a triple and enjoying the savings!

 

 

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

For those keeping score at home, this is the fourth installment in the Baseball Season and eProcurement series. In the previous posts in this series, we highlighted some examples of how SafeSourcing customers have achieved and enjoyed hitting singles and doubles in their online Request for Quote (RFQ) Events. A triple is an Event that creates savings between 15% and 19.99%.

In the past, we had reviewed a couple of different examples for each. In today’s post, we’ll focus in on one interesting example of a triple. In future installments of this series, we’ll focus on Home Runs and Grand Slams.

Today’s example is one that many might not think of when they consider eProcurement or reverse auctions. Often, when considering categories for eProcurement, many of our customers first look to indirect spend items with many focused on supplies. While those are great items and reducing the cost of copy paper and other suppliers is fantastic, there are many more opportunities that are often left out of consideration.

One great example of this type of overlooked item is prepared chicken salad. Because this is an item that will vary in style, taste, and quality from supplier to supplier, many of our customers would not consider sourcing their prepared chicken salad using SafeSourcing’s RFx tools to reduce costs. That said, one of our more experienced customers did just that with really incredible results. This customer, a retailer, had a very large annual spend in their chicken salad that they utilize in their foodservice offering. Their savings was an incredible triple that generated a triple with their current supplier and some alternatives. What that meant was that not only could they have gone elsewhere if the samples from the competitor were of the right perceived quality, they could also get that savings from their current supplier and not change a single thing other than the price they pay. That is exactly what any customer would want to happen in this scenario. This proves that even if the item can’t be defined as precisely as a ream of copy paper can, the process and the tools used by SafeSourcing will reduce your costs. This customer knows that’s true and has over $650K in savings to remind them.

By the way, after this particular Event, the incumbent supplier also called SafeSourcing to reduce their costs and they were successful in that as well. So far, that customer has hit a double and a home run.

There are many results like these and there are interesting stories including great savings dollars behind each. In the next entry in this series, things will get pretty exciting as we look at some examples of Home Runs.

Contact SafeSourcing, Inc. if you’re interested in learning more about how RFQ Events can help your company advance the bases and achieve savings.

 

 

HEY! Leadership Teams!

July 16th, 2019

I’ll bet your procurement team tells you they can source all of your products and services better than any e-procurement solutions provider?

 

Todays post is from Ron Southard CEO at SafeSourcing Inc.

Let’s also assume that you want to drive the greatest possible savings across the broadest range of categories in the shortest amount of time, like the next budget period; and want a sustainable process moving forward. Are you comfortable with your teams answer?

A number of issues you might consider are whether you have the requisite headcount, specifications, strategy, research skills as well as knowledge of new sources of supply to accomplish these lofty goals yourself.

Once you have settled on the fact that your existing team cannot achieve the above goal, the next question should be; what type of event services can an e-procurement solutions provider offer to help us if we can’t this ourselves?

By now, let’s assume you have come to the conclusion that there is no way possible for your team to do this alone. You now need to find a reputable eProcurement solutions provider. A quality e-procurement solutions provider should be able to ramp up to your task immediately. They should possess skills that are the foundation of their past success. These are very specific skills that enable them to run large volumes of e-procurement events in a full service mode with little guidance from you that have historically driven impressive savings on products and services over a long period of time. They should be able to provide reference to where they have done this in the past and how they were able to augment other company’s staff with little interference of their day to day work. Remember, knowledge transfer; passion, skill and required headcount to carry out these practices on a day by day basis are what drive results.

This process is provided by people behind the scenes with a very specific skill sets. If you really want to drive the greatest possible savings across the broadest range of categories in the shortest amount of time, like your next budget period. And, you already know that you cannot do this by yourself, reach out to a Safesourcing customer services account manager to see how quickly we can be of assistance.

We look forward to and appreciate your comments.