Archive for March, 2012

For e-negotiation events, when is a specification not just a specification?

Thursday, March 15th, 2012

Often is services sourcing a good SOW may in fact be the specification.? A statement of work or SOW is another document that is typically added to e-negotiation events in order to bring clarity to what is included in a bid. In essence the document lists the work activities to be agreed upon, the deliverables and a timeframe in which a supplier will be expected to perform against. The SOW requires agreement as do other documents prior to a supplier being allowed to place bids.??

Areas that are normally included in a Statement of work might include but are not limited to the following.

1.?The actual scope of work to be completed
2.?The time period in which it is to be performed
3.?The location of work.
4.?A list of the detailed deliverables
5.?A Schedule of all deliverables
6.?A standards adherence document.
7.?Acceptance criteria
8.?Other requirements.

Make sure that when you are running e-negotiation events that you make sure that all of the above information is considered and captured before you approve of an event being passed on for suppliers to review.

We look forward to and appreciate your comments.

A Truism – Why some buyers think e-Procurement will never work.

Wednesday, March 14th, 2012

This author has discussed on many occasions the various benefits to retailers of using e-Procurement tools. Not the least of which is that if a retailer were seriously to assign twenty percent of their above the gross margin line spend to these types of tools, they could increase their net earnings by up to 100%. In addition, much of the following would also happen.

1. They would continue to source high quality products.
2. They would continue to have great supplier relationships.
3. They would free up time to do other tasks.
4. They would improve their company’s net earnings by up to 100%.
5. They would support our fragile environment.
6. They would support global food and product safety initiatives.
7. They would have a larger audience of piers to converse with daily.
8. They would have a single source of information about their profession.
9. They would be instantly alerted to product recalls.
10. They would support a traceable supply chain.
11. They would have an endless source of new suppliers to review easily.
12. They would have product specifications at their finger tips.

Now you might wonder why many companies are not enjoying these benefits already. The following are the objections I hear all of the time after we have presented to a prospect that has not been exposed to e-procurement tools in the past.

1. I already get the best cost.
2. We’ve done business with this supplier for years.
3. I don’t have product specifications.
4. I don’t have time for this.
5. Switching costs will be too high.
6. I can’t insure the same quality.
7. We need to adhere to certain standards.

If you have an objection that is not listed above, or they pretty much fit your thinking, please review the dozen benefits above and weigh it against them.

We look forward to and appreciate your comments

A Truism – Why some buyers think e-Procurement will never work.

Wednesday, March 14th, 2012

This author has discussed on many occasions the various benefits to retailers of using e-Procurement tools. Not the least of which is that if a retailer were seriously to assign twenty percent of their above the gross margin line spend to these types of tools, they could increase their net earnings by up to 100%. In addition, much of the following would also happen.

1.?They would continue to source high quality products.
2.?They would continue to have great supplier relationships.
3.?They would free up time to do other tasks.
4.?They would improve their company?s net earnings by up to 100%.
5.?They would support our fragile environment.
6.?They would support global food and product safety initiatives.
7.?They would have a larger audience of piers to converse with daily.
8.?They would have a single source of information about their profession.
9.?They would be instantly alerted to product recalls.
10.?They would support a traceable supply chain.
11.?They would have an endless source of new suppliers to review easily.
12.?They would have product specifications at their finger tips.

Now you might wonder why many companies are not enjoying these benefits already. The following are the objections I hear all of the time after we have presented to a prospect that has not been exposed to e-procurement tools in the past.

1.?I already get the best cost.
2.?We?ve done business with this supplier for years.
3.?I don?t have product specifications.
4.?I don?t have time for this.
5.?Switching costs will be too high.
6.?I can?t insure the same quality.
7.?We need to adhere to certain standards.

If you have an objection that is not listed above, or they pretty much fit your thinking, please review the dozen benefits above and weigh it against them.

We look forward to and appreciate your comments

Don’t let moving your products from point A to point B be a “freightening” experience.

Tuesday, March 13th, 2012

It really does not matter what type of company you meet with, the question as to how you would source their freight always comes up.

Freight impacts all companies, the challenge is to understand the not so upfront costs and where they’re embedded. Whether you are shipping directly to your customer’s distribution centers with your own fleet, using a 3PL or just sourcing your freight lanes, the issues impacting the cost of freight are the same. If you understand how to unbundle them you will have a much better chance of controlling these costs going forward. It is not as simple as the price of diesel is rising and as a result so is the cost of moving freight.  However following trends does offer some insight as to what the industry is doing in general.

A site that I visit regularly is DAT® TransCore® Trendlines. This site which is updated all of the time that allows you to follow periodic Freight Rates, Fuel and Credit Trends. This at least allows you to measure your contract rates and the escalators and de-escalators associated with them versus up to date industry data relative to the long term and spot market capacity for flatbeds, refers, vans etc. Armed with this information which you can link to your procurement dashboard you can begin to decipher where your costs are relative to the rest of the industry and how to break them out in order to drive your costs down.

Just remember that the more you know the better you can negotiate. If you’re interested in sourcing your transportation rates, please reach out to a customer services representative at SafeSourcing.

We look forward to and appreciate your comments.

Don?t let moving your products from point A to point B be a ?freightening? experience.

Tuesday, March 13th, 2012

It really does not matter what type of company you meet with, the question as to how you would source their freight always comes up.

Freight impacts all companies, the challenge is to understand the not so upfront costs and where they?re embedded. Whether you are shipping directly to your customer?s distribution centers with your own fleet, using a 3PL or just sourcing your freight lanes, the issues impacting the cost of freight are the same. If you understand how to unbundle them you will have a much better chance of controlling these costs going forward. It is not as simple as the price of diesel is rising and as a result so is the cost of moving freight.? However following trends does offer some insight as to what the industry is doing in general.

A site that I visit regularly is DAT? TransCore? Trendlines. This site which is updated all of the time that allows you to follow periodic Freight Rates, Fuel and Credit Trends. This at least allows you to measure your contract rates and the escalators and de-escalators associated with them versus up to date industry data relative to the long term and spot market capacity for flatbeds, refers, vans etc. Armed with this information which you can link to your procurement dashboard you can begin to decipher where your costs are relative to the rest of the industry and how to break them out in order to drive your costs down.

Just remember that the more you know the better you can negotiate. If you?re interested in sourcing your transportation rates, please reach out to a customer services representative at SafeSourcing.

We look forward to and appreciate your comments.

Understanding the trends that impact your customers!

Monday, March 12th, 2012

Today?s post is by Mark Davis; Sr. Vice President of Operations and CTO at SafeSourcing.

The world evolves more quickly every day; not too many would doubt that.? As the population changes, grows and reshapes those that cater to who they are and what they buy need to be aware of emerging trends and what they can mean to business.? Those that find success will be the ones that can capitalize on trends by quickly adjusting their business to take advantage of them.

In today?s post we will be looking at some of the important trends to keep in mind as you discuss strategies, technologies, marketing messages and the future.

The Couponers ? According to a study performed last year by Scarborough Research, coupon usage for households has gone up 26% since 2006.? With the changes in the economic landscape, this? number is not a surprise to anyone,? particularly as families continue to struggle? in order to find ways to make ends meet.? What is important here is that the study showed that 1/5th of couponers utilizes electronic coupons/discounts in order to save money.? This trend is important as it allows companies to leverage their existing technologies such as Email, texting, Twitter, Facebook etc.? to launch campaigns to an audience that prefers their media in a way that costs them significantly less than traditional? methodology.? Finding partners who can help you immediately leverage evolving trends is key.

The Boomers ? For decades, the generation of the population known as the ?Baby Boomers? (those Post- World War II babies born between 1946 and 1964) have held significant purchasing power as advertising, television programming, marketing, product development have all placed emphasis on catering to this group of the population which represents close to 1/3 of the population and which just began entering retirement age in 2011.? The years to come will not likely change this trend, in fact, they will likely demand more attention and change as average lifespan continues to lengthen and the baby boomers require those who sell to them to adapt their services and products to their needs as they enter the next stages of their lives.? Understanding these new needs will allow good companies to react and focus their efforts on a group of the population who will continue to be influential for many years to come.

Hispanic Focus ? As a cultural group that represents 17% of the population and a buying power north of $1 trillion, it is no surprise that companies have expanded their marketing focus to include emphasis on this growing demographic.? In an article this past Friday, in MediaDailyNews, a review of the Association of Hispanic Advertising Agencies study? stated that as the Hispanic demographic continues to grow over the next decade (5.7%), companies that have already begun expanding their approach to include direct efforts toward the Hispanic population have seen a noticeable increase in revenue from this group.? Companies that are able to work with their internal and external teams to expand their marketing will find that they have a better-rounded message to their customers and a higher level of loyalty from those groups.

For more information on how you can adapt your services to meet evolving trends or to locate vendors to partner with that are already providing this support, please contact a SafeSourcing Customer Service Representative.??

We look forward to your comments.

Sourcing the best possible freight lanes.

Friday, March 9th, 2012

Obviously? you do ot want your freight lines trying to cut corners by traveling the ICE ROADS. Can anyone say help!!!

By the way, your?DC delivery?will be late this week.

Let’s hope?we sourced?a different route for?next week.

Here’s a repost that I love. Here are twenty reasons why all retailers should use E-Procurement tools now.

Wednesday, March 7th, 2012

Since this is not Late Night with David Letterman, our list is not ranked in order of importance although many might argue that not much is more important than improved earnings. but for yesterdays customer question, here are two Letterman shows worth.

1. Guaranteed to improve net earnings
2. Guaranteed to improve safety
3. Guaranteed to improve Corporate Social Responsibility.
4. Guaranteed new sources of supply
5. Retail has less spend assigned than any other industry
6. Streamlines the  procurement process
7. Holds suppliers accountable to your standards.
8. Improves quality
9. Coast avoidance in a volatile market
10. Creates a competitive environment
11. Drives reliable market pricing
12. Maintains a reliable history for future comparison
13. Educates suppliers as to how retailers wish to procure products
14. Supplier training eliminates questions
15. Improved and consistent product specifications
16. Improved negotiation.
17. Improve carbon footprint
18. Simple award of business process
19. Frees up time for other tasks
20. Works for procurement of all product categories

This author is not sure why a derivative of this list could not become the mission statement for any procurement department.

We look forward to and appreciate your comments.

Here’s a repost that I love. Here are twenty reasons why all retailers should use E-Procurement tools now.

Wednesday, March 7th, 2012

Since this is not Late Night with David Letterman, our list is not ranked in order of importance although many might argue that not much is more important than improved earnings. but for yesterdays customer question, here are two Letterman shows worth.

1.?Guaranteed to improve net earnings
2.?Guaranteed to improve safety
3.?Guaranteed to improve Corporate Social Responsibility.
4.?Guaranteed new sources of supply
5.?Retail has less spend assigned than any other industry
6.?Streamlines the? procurement process
7.?Holds suppliers accountable to your standards.
8.?Improves quality
9.?Coast avoidance in a volatile market
10.?Creates a competitive environment
11.?Drives reliable market pricing
12.?Maintains a reliable history for future comparison
13.?Educates suppliers as to how retailers wish to procure products
14.?Supplier training eliminates questions
15.?Improved and consistent product specifications
16.?Improved negotiation.
17.?Improve carbon footprint
18.?Simple award of business process
19.?Frees up time for other tasks
20.?Works for procurement of all product categories

This author is not sure why a derivative of this list could not become the mission statement for any procurement department.

We look forward to and appreciate your comments.

An effective procurement strategy is a key to supply chain risk mitigation.

Tuesday, March 6th, 2012

Supply chain risk management is the process of identifying factors that could disrupt the production process.? Because conducting business is such a complex activity, the sources of such disruption are going to be many and varied; but because they cost the people who run and work for the business so much time and money, these people will naturally want to have some way to minimize the amount of risk.? One of the most effective means of supply chain risk management is establishing a sound, effective procurement strategy. Let?s define procurement as the acquisition of goods and services, in both the proper quantity and at the proper quality, when they are needed, where they are needed, and usually by means of a contract.

There is a company that devotes itself to helping other business owners determine which procurement strategy will work best for them.? SafeSourcing has developed an e-procurement process which is enhanced by the use of multiple tools? The SafeSourceIt Database, which has 380,000 suppliers and uses a set of twenty- five safety certifications to screen suppliers, a highly innovative and simple to use e-negotiation tools called SafeSourceIt? where buyers and sellers have an entire RFX library at their disposal. If you?d like to learn more about the entire SafeSourceIt? family of products, please contact a SafeSourcing representative.

The proper procurement strategy can help company?s avoid financial challenges.

We look forward to and appreciate your comments.