Archive for November, 2018

Spend Analysis Part I of II

Thursday, November 29th, 2018


Today’s post is by Alex Borbely, Director of Sales at SafeSourcing

In yesterday’s post we explored what Spend Analysis is and some of the experiences I have had spending time with customers during the review process.

Today we’ll look at the steps involved in Spend Analysis.

Typical Steps of Spend Analysis: Identify all the sources available for your spend data, from all of your departments, plants and business units. This includes accounts payable, general ledger, pCard, eProcurement systems, etc. Gather and consolidate all of your spend data into one central database. This can be difficult if your data is in different formats, different languages and different currencies, however, there are programs available specifically designed to accomplish this however not necessary and a simple Excel workbook may be used.

Cleanse your data. This includes finding and correcting errors in descriptions and transactions, as well as standardizing the spend data for easy viewing. Group, or link, your suppliers for better supplier management. For instance, purchases made from IBM, IBM Corp., or Cognos should all be grouped together, since they’re the same supplier. Categorize your spend. Whether you use specific industry standard classifications or your own company-specific categories, you need to be able to determine where your money is being spent. Office supplies, marketing travel, legal, direct and indirect spend should all be categorized appropriately.

Analyze your spend data. Ensure that you have negotiated the best contract deals per supplier now that all of your spend is identified. Ensure that all of your buyers are purchasing from preferred suppliers. Reduce the number of suppliers per category. Repeat. Performing a spend

analysis once is a great start to identifying savings, however, you need to continually update your data to ensure that contract terms are being adhered to, that buyers are purchasing from preferred suppliers and that savings opportunities are being identified.

Once the Spend Analysis is completed, and reviewed with the client, there are several lessons learned as a result:

  1. Upon completion you now have a baseline for sourcing initiatives
  2. Spend Analysis now becomes an enabler for process improvement
  3. The known data is now a measurement device for cost reduction programs such as SafeSourcing’s Reverse Auction Events
  4. Significant cost-savings opportunities through supplier and commodity consolidation
  5. Enhanced compliance through effective spend and supplier monitoring, which by the way is part of the SafeSourcing full service program
  6. Comprehensive spend visibility across direct and indirect commodities and services

In closing I cannot help but to remember something that was drilled into my head as a young individual by my parents: “It’s not about how much money you make, it’s about how you save it.” This says it perfectly as to why spend analysis is such a vital part of procurement planning.

For more information on how we can help you with your procurement needs or on our Risk Free Pilot program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.







Spend Analysis Part I of II

Wednesday, November 28th, 2018



Today’s post is by Alex Borbely, Director of Sales at SafeSourcing

While visiting with retailers and manufacturers during the pilot event stage, and watching live events unfolding in front of the client, it is exciting times at SafeSourcing when we show what competition in procurement spend can do.  What other solution can a prospect see instant dollar’s fall right to their bottom line in a matter of a 20-minute reverse auction event?  SafeSourcing, thus far in 2018, has saved on average 24.5% for our clients.  All this falling right to their bottom line.  As I said to a new client watching their first reverse auction event this past week, their 22.3% in savings in one reverse auction event goes right to their bottom line.  I asked my client, how many new customer cups of coffee would you have to sell in order to see a similar impact on your bottom line?  Reality is that selling more in today’s competitive world is difficult without losing margin.  Reducing expense on spend with SafeSourcing’s full service events will add to bottom line profitability at a rate of 10X ROI on average.  This meaning what you pay for an event in most instances will be multiplied in savings by 10 times or more!

After our typical 2-pilot events are executed and the client witnesses the power of SafeSourcing’s  ePROCUREMNT and the reverse auction Event they then ask what’s next? Our typical response is let’s discuss what you spend your money on for both direct and indirect spends.  We usually get that deer in the headlights look and hear “well that is handled by many individuals within our organization and we would have to get with them to see if they know how much is spent in each category”.  The result is 9 out of 10 responses are that “they don’t know”.  This is when SafeSourcing suggests that we engage with the client and together we orchestrate a spend analysis to highlight spend and where SafeSourcing can assist with historical sourcing events results that is the proof of the pudding.  Let’s begin by understanding spend analysis:

Definition: Provide top level picture of spend. Spend Analysis is the process of collecting, cleansing, classifying and analyzing expenditure data with the purpose of decreasing procurement costs, improving efficiency, and monitoring controls and compliance. It can also be leveraged in other areas of business such as inventory management, contract management, complex sourcing, supplier management, budgeting, planning, and product development.

At SafeSourcing we use our internal tool and  process called SafeSpendAnalysis™

Tomorrow we’ll review the typical steps in a spend analysis during Part II!

For more information on how we can help you with your procurement needs or on our Risk Free Pilot program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today


Don’t Cut before Measuring

Wednesday, November 21st, 2018


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

Don’t cut before measuring. It’s a common phrase and probably one of the first things someone learns when doing any kind of construction – measure before you cut. In fact, many people would recommend measuring a board multiple times before ever making any cuts. While this saying is primarily woodworking, home improvement, or construction specific, the idea can prove useful in multiple industries.

The idea here is that each and every time you are about to execute a project, first make sure you are doing it right. Then make sure again. Sometimes, we can miss important details or overlook glaring errors. For example, while sending an email and forgetting to attach a document is a minor detail, sending an email to a wrong person can be much more serious.

SafeSourcing, however, can help with some things that are often overlooked. For example, when sourcing a product, we analyze the data and the specifications and check them against invoice and industry standards. This ensures that the data is correct and that the savings you see after your procurement project completes is true. We can work with your own procurement, purchasing, or finance department and determine which categories would best be taken out to source. Do you know if you are getting the best price on the goods you already purchase?

For more information on how SafeSourcing can help in your procurement efforts or to help analyze your data, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative.

We have an entire team ready to assist you today.


Rapid Growth of Foodservice Disposables

Tuesday, November 20th, 2018



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

The global foodservice disposables market is experiencing rapid growth, linked to growing online food ordering and home delivery services, according to a report by Persistence Market Research.

North America dominated the global food service disposable industry with 21.4 billion in revenue in 2015. The food service disposable market in North America is anticipated to reach 27.50 billion in 2021. This is largely due to increasing population, expanding commercial markets, and the convenience of single-use service ware.  Busy lifestyles and low consumer preference towards cooking at home also acts as a major driver for the foodservice disposables market.

An increasing number of food and coffee joints for hanging out are another predominant factor driving growth of foodservice disposables market. The increased focus on gourmet coffee and specialty cold drinks by restaurants and convenience stores has heightened interest in higher-cost environmentally friendly products. In an effort to mineralize wastage, multiple shops have started offering reusable cups and plates. With foodservice business experiencing impressive growth, the increase of foodservice disposables market has become unstoppable and is not likely to slow down anytime soon.

Plastics are the most widely used raw material for the manufacture of disposable foodservice products. When compared to paper, paperboard, and aluminum, plastic is expected to evolve as the preferred raw material in the foodservice disposables industry. With the recent push for eco-friendly products, manufacturers are emphasizing the use of recyclable plastics. Due to this sustainability trend, several vendors are slowly moving toward the use of compostable and eco-friendly raw materials to manufacture foodservice disposables. Although, governments across various nations are executing various regulations on the use of plastic, popularity of plastic is not likely to come down drastically, as it has widespread acceptance.

Disposable service ware, including single-use cups, dinnerware and utensils, will remain the largest product type through the year 2021 and beyond. However, the fastest demand growth is expected in the disposable packaging segment, which includes foodservice containers, lids and domes, wraps, bags, and trays.

The food packaging industry has become extremely competitive and manufacturing companies are continually improving their products and availability of efficient and sustainable products. Let SafeSourcing source your foodservice products!

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




Knowledge is Power

Monday, November 19th, 2018



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

At SafeSourcing, we host many eProcurement Request for Quote (RFQ) events. In fact, this is a large portion of our services because of the savings that this generates for our customers. If we’ve spoken before, you’ve probably heard me talk about this. Specifically, that while each of SafeSourcing’s customers might source a particular category once a year or once every two years, SafeSourcing is likely sourcing that same category many times a year.

This is where SafeSourcing’s knowledge can become your power. I’ll offer this following example, but just know that this is one of many examples that we could share.

Many of our retail clients sell hot and cold beverages. Of course, these come in a variety of cups with different lids and different straws, but for this example, I’m talking about foam cups. Many of our customers are aware of 1-2 suppliers that offer these cups. We actually have more. That wider supplier base generates real savings in an RFQ scenario. It’s easy to talk about recent savings percentages or to speak generally, but consider this next specific statement.

At SafeSourcing, our retail convenience store customers have saved an average of about $5,000 per store on their foam cups, lids, and straws in the past year while still awarding to their incumbent vendor.

What this statement means is that there is a very strong likelihood that you can save on this category too. If you are a convenience store operator, and you have 50 stores where you use these products, that could be a quarter of a million dollars that you’re overpaying per year. Maybe it’s not the exact case for you, but the data tells me that it’s very likely. Shouldn’t you use SafeSourcing’s knowledge to your benefit?

As I said, this was just one specific example out of many. The only way to really tap into SafeSourcing’s category knowledge is to talk with us.

  • Ask us a specific question about category savings.
  • Ask our opinion on the current market conditions for a category.
  • Ask about the timing of a category due to harvest seasons.

I’ll share one more thing that we know at SafeSourcing; if you aren’t using SafeSourcing for our knowledge and our RFQ services, then you’re overpaying on all your spend.

For more information, please contact SafeSourcing. 


Kroger Offers a new way to Shop

Friday, November 16th, 2018


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

I was in my local Kroger the other day and saw a kiosk full of scanners.  So, when I got home I decided to go online and see what they were all about.  It turns out the scanners are part of their new shopping experience called Scan, Bag, Go.  This new way of shopping is available for people that would like to scan and bag the items as they walk throughout the store.  Not only can you use the scanners, but you can also download an app to your device and use the device instead.  To start, you need to log into the scanner or app with your account and as you shop you just scan the item and place it in your bag or cart.  You must scan each item one at a time, and for produce, you bag the items, scan the barcode on the item or the shelf tag, scan a barcode on the closest available scale and follow the directions for weighing the items.  As you are shopping, you can see your running total and fuel points accumulated.  So using a calculator or cell phone are no longer needed for those who like to keep track of their spend during the shopping process.  When you are finished shopping, just head to self-checkout and scan a barcode on any available machine and complete the pay process.  This new offering is a speedy way to get what you need and avoid the hassle of the long checkout lines.

Interested in learning how SafeSourcing can help your company run more efficiently? Like to try a risk-free trial? Please don’t hesitate to contact a SafeSourcing Customer Service Representative. Our team is ready and available to assist you!

We look forward to your comments.



Tactical and Strategic Sourcing

Wednesday, November 14th, 2018


Today’s post is from our SafeSourcing Inc Archives

Let’s define each one then note the differences. This will aid in better understanding how procurement professionals justify adopting one sourcing method or the other.

Strategic Sourcing

Strategic sourcing is a precise, long term approach to acquire supplies and or services for an organizations current need at the lowest total cost of ownership (TCO) and the lowest risk to the supply chain. This process creates a relationship between the customer and vendor that will ensure continuous improvement in quality, delivery, cost and service while providing the means to attain ideal proficiencies with both parties. There are three key components of strategic sourcing; spend analysis, market research and supplier evaluation and relationship management. These steps require a specifically trained staff using a specific software tool to achieve desired outcomes.

Tactical Sourcing

Tactical sourcing is a short term, transactional activity practiced in small to medium companies. This approach to purchasing goods and services uses quick quote and order processing to support the company’s production or needs. This approach does require management within the company to ensure the right material is purchased at the right price and at the right time. Unlike strategic sourcing, companies are not concerned with the vendor’s core capabilities or creating a long-term relationship.

So based on the two sourcing methods one might think that the strategic approach makes for best practices compared with the tactical method. So why do many companies choose the latter of the two.

Consider a small to medium sized company where purchasing has the ability to use just about any supplier that fits their need. Typically, buyers will use their own best judgement to find the right supply that meets both their pricing and best shipping dates. This is very common in companies that don’t have the luxury of time or technology to assist them from shifting form tactical to strategic purchasing. Their biggest concern is to keep things moving while keeping an eye on costs, hence why tactical sourcing makes the most sense.

Now compared this to a larger company where they could have a suite of ERP technology and a dedicated team of purchasers. They have the time and resources to properly vet suppliers, develop reports, perform a spend analysis, and conduct market research. With these capabilities, procurement can negotiate lowest total cost of ownership (TCO), taking into consideration, quality, price, delivery and lead times. These buyers will have a deeper understanding of the company’s overall needs and requirements. Taking a strategic sourcing approach makes the most sense in these cases.

Finding the best sourcing method for any size company should be a priority, yet time and time again, companies fail to implement any thoughtful process or policy costing them time and money. SafeSourcing, with its dedicated staff and E-procurement suite of tools could do just that. Lower your risk and increase savings without hiring additional staff or buying expensive software. It’s a win-win!

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


Tuesday, November 13th, 2018



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

CVS Health’s $69 billion bid to acquire insurer, Aetna, has been approved by The Justice Department (JOD) . This could redefine how Americans get insurance. The JOD requires CVS to divest Aetna’s Medicare Part D prescription drug plan business for people as part of this deal. CVS has proposed selling that part of the business to WellCare Health Plans, which would satisfy the JOD’s request. “The divestitures required here allow for the creation of an integrated pharmacy and health benefits company that has the potential to generate benefits by improving the quality and lowering the costs of the health care services that American consumers can obtain,” Assistant Attorney General Makan Delrahim said in a statement.1

This merger would allow the Woonsocket, Rhode Island-based CVS to expand its drugstore-pharmacy (with more than 9,800 locations) into a healthcare coverage and medical care delivery destination. This would also allow more customers into CVS facilities for routine health ailments and away from costly emergency hospital visits. Aetna is the third largest U.S. health-insurance company and fourth-largest individual prescription drug plan insurer.

CVS Health indicated the Aetna acquisition is expected to close within the fourth quarter of 2018. Once the merger is completed, Aetna will run as a standalone business within CVS.

For more information on SafeSourcing, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you.


Mike Snider, USA Today,10/11/2018





It’s just a pallet; or is it? Part II of II

Monday, November 12th, 2018


Today’s post from our  SafeSourcing, Inc Archives

Use of Pallets: While pallets and palletization were once considered to be powerful components of material handling strategy, today, industry takes the practice largely for granted.  When the palletization concept was first introduced, however, it had a dramatic impact on the improvement of material handling efficiency. Rail cars, for example, that had taken two days to unload could subsequently be unloaded in just one or two hours.  Palletized products can be moved more quickly than by the manual handling of individual palletized cartons.

Benefits of this quicker handling include:

•   Faster turnaround of delivery vehicle and increasing operational efficiency of transport equipment
•   Dramatically reduced labor requirement versus manual handling
•   Reduced risk of temperature abuse for perishable products on unrefrigerated docks
•   With less manual handling there is less risk of product damage and reduced risk of worker injury. Palletized products can be moved more efficiently and stored more efficiently in warehouses and customers often prefer the receipt of palletized goods.
•   Pallets provide drainage and circulation for commodities requiring this, including fresh produce.

Grades of pallets: The GMA (Grocery Manufacturer Association) has determined the standard in which pallets are graded and thus is broken into four (4) different categories. Each category is a guideline to use when buying or selling pallets. The problem is that each category is open for interpretation and it’s important to verify exactly what you’re getting. Each category will have a price range and the price range will vary from region to region. The price will also vary based on the amount of available reconditioned pallets. Below are the four (4) different grading categories and their corresponding condition.

•   Premium – A very clean pallet that has probably been used only a few times. There is little if any repairs to the pallet. The pallet will have no plates and no companion stringers.
•   Grade #1 or A Grade – Typically this pallet has been repaired to close to its original condition. Broken stringers may have been replaced or repaired with metal plates. All damaged deck boards are replaced. This is a fairly clean pallet that is structurally sound.
•   Grade #2 or B Grade – Typically this pallet has had stringer damage that has been repaired by attaching an additional stringer alongside the damaged one. This is commonly referred to as a companion stringer, block stringer and double stringer. The “B” grade pallets usually have two (2) or less repaired stringers. The deck configuration on the “B” grade pallet is not always consistent because these pallets have been repaired many times.
•   Grade #3 or C Grade – Typically this pallet has been repaired numerous times. Most of the stringers on a “C” grade pallet will have companion stringers. The deck boards will be inconsistent in size, spacing and thickness. These pallets are usually in very poor condition and are accepted by few companies.

Owned vs Pool pallets: Many companies choose to buy their own fleet of pallets, but this is not always the best or most efficient thing to do.  What you need to consider…


•   Cost: Depending on the amount of goods a company needs to transport, it can be very expensive to buy and upgrade a pallet fleet.
•   Management and tracking: Managing and tracking a rental fleet can be very hard work, if mismanaged, it can create huge problems if goods cannot be transported when needed.
•   Maintenance and cleaning: Once purchased, pallets will need to be continually repaired and cleaned in between usage, requiring the manpower, space and equipment to do this.
•   Storage: When not in use, pallets can take up a lot of space, which is inefficient and costly.
•   Fleet fluctuations: If a company suddenly has an increased order, or an order that requires a special type of pallet, then buying them just for these rare occasions is wasteful, as the rest of the time the overflow will just be gathering dust in storage


•   Flexible: You can rent as many or as few pallets as you need for each specific shipment, meaning you’re never over or under stretch with your pallet fleet.
•   Management and tracking: The pooling company can use their own specialist up-to-date management and tracking systems meaning you doesn’t have to worry about it.
•   Cleaning and maintenance: After each hire, the pallets will be inspected, repaired and cleaned by the pallet pooling company, before they are sent out again.  This means that you don’t need to worry at all about the expense of doing this yourself, and you know all the pallets will be up to standard before each use.
•   Storage: Once you’ve finished with the pallets you just need to hand them back to the pooling company with no need to set aside valuable space to store them.

As you see there are many things to consider before buying or pooling pallets in your business. Should you own pallets or use a service to manage them? What type of pallet do you really need? We at SafeSourcing are ready to help you through all the questions and help you lower your procurement costs.  For more information on how we can help you with your procurement needs 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

It’s just a pallet; or is it? Part I of II

Friday, November 9th, 2018


Today’s post is from our  SafeSourcing Archives.

If you’re in a business today that provides goods, supplies, equipment  and alike somewhere along the line these products most likely traveled on a pallet, either in the loading, shipping, delivery or receiving process.  Pallets are the most common method for this as well as being used for storage purposes.  In this article I wanted to share some key factors to consider when purchasing, using or accepting pallets, no matter the originating source.   In this blog my intention is to educate you a little more than you probably wanted to know about pallets.

First the definition,  pallet:  sometimes inaccurately called a skid (a skid has no bottom deckboards), a pallet is a flat transport structure that supports goods in a stable fashion while being lifted by a forklift, pallet jack, front loader, work saver or other jacking device. A pallet is the structural foundation of a unit load which allows handling and storage efficiencies. Goods or shipping containers are often placed on a pallet secured with strapping, stretch wrap or shrink wrap and shipped. While most pallets are wooden, pallets also are made of plastic, metal, and paper.

Types of pallets: although pallets come in all manner of sizes and configurations, all pallets fall into two very broad categories: “stringer” pallets and “block” pallets. Various software packages exist to assist the pallet maker in designing an appropriate pallet for a specific load, and to evaluate wood options to reduce costs.

•  Stringer pallets use a frame of three or more parallel pieces of timber (called stringers). The top deckboards are then affixed to the stringers to create the pallet structure.  A stringer pallet is also known as a “two-way” pallet, since a pallet-jack can be used from only two sides to move it. Two-way pallets are designed to be lifted by the deckboards. In a warehouse the deckboard side faces the corridor.
•   Block pallets are typically stronger than stringer pallets. Block pallets utilize both parallel and perpendicular stringers to better facilitate efficient handling. A block pallet is also known as a “four-way” pallet, since a pallet-jack may be used from any side to move it. Four-way pallets or pallets for heavy loads are best lifted by their more rigid stringers. A warehouse has the stringer side facing the corridor.

Efficiencies: organizations using standard pallets for loading and unloading can have much lower costs for handling and storage, with faster material movement than businesses that do not. The exceptions are establishments that move small items such as jewelry or large items such as cars.  But even they can be improved. For instance, the distributors of costume jewelry normally use pallets in their warehouses and car manufacturers use pallets to move components and spare parts.

Pallet pooling:  due to cost and a need to focus on core business, pallet pooling becomes more and more common. A pallet management company can help supply, clean, repair, and reuse pallets. Pallets should be seen as reusable packaging items. Every pallet that is built could potentially be used and used again until such a time when it will need to be replaced.

Stay tuned for Part II of: It’s just a pallet; or is it?

There are many things to considered before purchasing pallets, such as; should I buy new or used pallets, what grade of pallet is right for my business, do I want a service to manage the pallet inventory for me?  We at SafeSourcing are ready to help you through all the questions and help you lower your procurement costs.  For more information on how we can help you with your procurement needs 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.