Detailed Expense Analysis is a key driver of Strategic Sourcing.

July 5th, 2012

Expense Analysis has great effect on both micro and the macro environment of the company!

Today’s post is by Ryan Melowic, Director of Customer Services at SafeSourcing.

An Expense Analysis is the detailed scrutiny conducted by firms for every expenditure made regarding any kind of expenditure made within the company. 

Expense Analysis has a great effect on both the micro as well as the macro environment of a company.  Macro environment consist of external factors that influence an organizations decision making and its performance, whereby micro is the vice versa, thus issues that affects the company internally.  On this basis, both macro and micro environments have effect on the cost analysis.  In this analysis, Positive factors are highly considered thus hindering the negative ones to determine a net result that enhances profitability.

Merchandise and services that the company is interested in acquiring are the major focal points in this evaluation.  Quality and quantity issues are weighed, concerning the profits and benefits mostly in the financial impact that the company will achieve by acquiring them.  Decisions like, whether the company should outsource or obtain permanent manpower, machines, its source of supply of essential raw materials, maintenance support and other key related areas are outlined.

Expense Analysis when incorporated in a company’s financial budget and planning,  goes a long way to ensuring not only the money involved in any kind of transaction is safe guarded but also  that the quality of goods or services delivered by a preferred supplier is purchased economically.

Strategic sourcing can help the company as a valued added service of procuring their products and services by focusing on  lower costs thorough scrutiny of suppliers by  tools such as; catalogs, market data, RFI’s, RFQ’s and reverse auctions.

If you’d like some details on Expense Analysis, contact a SafeSourcing customer services representative.

We look forward to and appreciate your comments.

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