Procuring Services for Your Organization

July 7th, 2015

What are some thoughts to keep in mind when procuring any type of services for your organization?"


Todays post is from our SafeSourcing Archive

The process of procuring services for you organization has a few aspects to keep in mind that are different then processes involving typically procured products.  How the company currently purchases these services tends to be varied and additional expenses that tend to be “bundled” into the price frequently provide very little visibility for you to understand what you are paying for.

The following are just a few tips to keep in mind when you are preparing the initial stages of finding new service providers.

Understand how and from whom you work with today – So many companies, especially those with more than one location, have an unclear view of the relationships, contracts, and pricing that they pay for the exact same services throughout the organization.  Understanding how each part of the company works with the providers of the services you are looking for is a critical first step to successfully developing a strategy for the entire organization.

Develop the strategy of where you want to go – Once you know where things stand it won’t be uncommon to have a variety of different contracts, terms and companies that you are dealing with.  Instead of trying to fit what you want into everyone’s model or contract, this is the time for you to determine how you want to be billed.  Knowing this and providing it to the vendor community early will help you get the details you need to make the best decision for the company.

Define Additional Expenses – Almost every vendor has a price list of “additional services” that fall outside of the normal course of business.  It is very important that you require every vendor you speak with to provide you the complete list of these fees and that they understand that any fee not listed will not be honored as part of the new contract with you.

Unbundle the “upcharge” – Upcharges are one of the great mysteries in dealing with service provider companies; many of whom would prefer to give you invoices with nothing more than one line item showing the weekly, monthly or annual charge.  By requesting the vendors to break this charge into smaller more detailed components, it will be easier for you to determine what you are paying for and will also give you stronger footing from which to negotiate your relationship with them.

For more information on best practices in procuring services for your company, please contact a SafeSourcing Customer Services Project Manager.

We look forward to your comments.

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