Let’s assume you are procurement professional for a company that is ready to find a better product or service solution for your company’s needs. This is when the legwork begins. So how much legwork is necessary to get the results you need? There are many factors that should be researched and investigated in order to make a value based decision for your company. Below are some guidelines you should consider as a necessary legwork.

UNDERSTANDING THE MARKET:

1.  Market Trends– Trends are what allow traders and investors to capture profits. Whether on a short- or long-term time frame, in an overall trending market or a ranging environment, the flow from one price to another is what creates profits and losses.  This is something that procurement professionals should keep an eye on so when the time comes they are armed with as much information as possible in order to make the best decision for their company.

2.  Pricing Trends– Understanding where the market is headed and why will allow you to make better decisions regarding long / short term contract purchases vs. potential spot buys as well as the need for possible price review intermittently.  The current price may be desirable but understanding the trend will allow for better decisions. Awareness and connection to the industry can only help when you are ready to act but more importantly develop a solid long term strategy.

3.  Hurdles– Think about people running in a foot race. They are running, and then they see something that blocks their way. They can stop running OR they can jump or go around the obstacle in the road and keep running. Think about work the same way. You worked hard to find the right supplier, cost and service. Now there are unforeseen problems that could result in additional costs or expenditures.  Building in contingencies will avoid such issues.

4.  Product Content – This is referring to the materials that are required to produce a product or support a service in order to meet necessary standards or specifications. This will affect the price of the product or service you want to purchase.  Companies may also have specific guidelines regarding environmental impact or safety standards.  Awarding business to a vendor that also has “green” initiatives in place that support your companies CSR initiatives can foster good will internally as well as in the community   you serve while also improving your company’s image as a pay it forward workplace.

If you’d like to learn more about how SafeSourcing thinks through it’s category to market strategy, please contact a SafeSourcing customer services representative

We look forward to and appreciate your comments

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 7: It requires a diversity of skills

Succeeding in procurement and supply chain management requires a broad diversity of skills. The skills required in the past, such as; hard-balling suppliers, policing compliance with procurement rules, and administering paperwork and procedures are now longer adequate. Instead what is required are CEO type skills, such as;

??Leadership
??Driving business performance and achieving business results
??Strategic thinking
??Partnerships and strategic alliances
??Internal collaboration and communication
??Understanding markets, predicting change and managing risk
??Innovation and creative thinking, including; new products and new markets.

We hope you have enjoyed the series on why we love procurement & Supply Chain Management and that you too will love each!

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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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 6: It is cross functional and collaborative

While traditionally procurement was traditionally seen as stand-offish and confrontational, best in class is highly collaborative in style. That means it engages with managers from all across the organization.

While it may have the authority to tell people what to do and to enforce compliance with procurement rules and procedures, it uses its power carefully, seeking to collaborate rather than control.

Its role includes evangelizing a better approach to all aspects of procurement, from sourcing to supplier management. It does not necessarily seek to wrestle the decision away from the front line manager, but rather to support the manager in the decision making process.

Because procurement is increasingly cross-functional in nature, it draws its team from all disciplines and backgrounds. It may second an engineer from R&D to head up a sourcing project for the components required for a new product, or hire an ex supply industry salesperson to manage and negotiate with suppliers from that same industry.

Stay tuned tomorrow for Part 7.

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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 5: It is complex and challenging

Orchestrating a supply chain that span different continents and integrate 1,000s of diverse sectors, from primary subcontractors, to the suppliers of the smallest components or parts, entail great complexity and challenge.

Operating at the interface of supply and demand effective supply chain management is key to:

???? (a)? The demand for more rapid innovation, including new products with rapid time to market and shorter product lifecycles.
???? (b)? Risk management and resilience in the face of:
????????? ??increased market volatility
????????? ??sudden and unpredictable international supply risks (from Tsunamis to political revolutions)

(c) Legal compliance, from product traceability of certain goods, to diverse trade, employment and other regulations across the variety of international markets. It requires thinking globally while complying locally.

Stay tuned tomorrow for Part 6.

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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 4: It is global

Globalization has and continues to be the dominant economic trend of the past 3 decades. Supply management is the oil in the cogs of global markets and supply chains that span the world.

Supply management transcends borders, cultures, languages, currencies and climates to bring products from one side of the world to the other. It has reshaped the economic order with the rise of the Chinese Indian and other economies as low cost manufacturing powerhouses.

Stay tuned tomorrow for Part 5.

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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

 
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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 3: It is strategic!

The CPO increasingly has the ear of the CEO and CFO ? it has direct access to power. That is because few managers have the potential to impact on the bottom line in the way that the head of procurement/supply management can.

As every MBA (and indeed every salesperson) knows; the way to improve the bottom line in a time of low growth is to cut costs, slim line production and drive efficiencies generally. This is something that procurement and supply chain managers have done very well.

At conferences procurement managers proudly boast of savings of millions delivered from procurement initiatives, with savings of 15-35% regularly being quoted. However, its impact on business performance goes well beyond cost savings.

Supply chain management is strategic because it matters to the longer term performance of the business. It will be called upon to support the implementation of almost any strategic initiative within the business and not just those that involve procurement.

Stay tuned tomorrow for Part 4.

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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 2: It is the new basis of competition

The most exciting companies of the past decade ? Apple, Dell and Amazon to name just a few ? have all had supply chain management at their core. Indeed, they could not have succeeded without it.

Supply management is the new and perhaps ultimate source of competitive advantage for modern business. It is at the core of new business models ? from manufacturing in low cost economies to selling across the web.

Today?s global industry leaders, such as Apple or Dell, make up in market capitalization what they lack in bricks and mortar. They own few factories, warehouses, or trucks. These have been replaced by a global supply chain that can produce at low cost and yet meet stringent quality standards, respond swiftly to peaks or troughs in demand and take new products from concept to reality in rapid time.

Production engineering is no longer the source of competitive advantage. It does not matter who owns the factory or where it is located. It is time to move over Demming ? Total Quality Management has been superseded by Supply Chain Management.

It is no longer about production engineering, but re-engineering of the very shape and structure of the organization. The value chain of modern business is the supply chain and that makes supply chain management the place to be.

Stay tuned tomorrow for Part 3.

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.

Today?s post is written by Heather Powell, CFT Director & Project Manager at SafeSourcing Inc.

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Sourced from: http://buyer.sellerinsights.com/2012/12/12/8-reasons-to-love-procurement/

Reason 1: It is new and exciting!

Supply chain management/procurement is new and exciting. It is the new global frontier of business and this is procurement?s golden age.

Purchasing has traditionally been regarded as a bureaucratic function at the organization?s edge responsible for ordering and replenishing supplies. It was concerned with paper pushing and form filling, in respect of transactions and supplies. However, buying has been elevated to new levels of importance and buyers have more clout than ever before. It is now a strategic business driver.

There are great advances being made in supply chain management/procurement, and yet there is a long way yet to go. Indeed, studies shows that only 16% of companies achieve procurement excellence, with 37% of companies at the bottom of the class. The rest are in the middle, or average category.

Stay tuned tomorrow for Part 2.

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.

Today’s post is written by Heather Powell, Manager of the COE Department & Project Manager at SafeSourcing Inc.

Pride – Being too self-satisfied; quality or state of being proud – inordinate self-esteem.

• Pride is thinking you’re better than you are.  Better at what doesn’t matter.  It’s not just misguided overconfidence.  It’s thinking you’re better than God and thus that you’re invincible.  This isn’t bad in small things like your jump shot.  It is bad when you cannot accept your limitations and live within them.

In e-procurement pride can be defined as- thinking that loyalty means something.

Sadly, the opposite often applies with complacency setting in with suppliers where contracts have been in place for many years. If your contract with your supplier is really delivering good value, then they won’t have any concerns about you ‘testing the market’ as this will surely prove it. Benchmarking longstanding contracts is a ‘no lose’ strategy for customers as it will either prove value, result in your supplier ‘sharpening their pencil’ or enable you to change to a supplier that is offering better value.

How to avoid this:

• Make it standard practice to regularly benchmark all of your suppliers, even those who you are happy with. It ensures that your suppliers are always ‘on their toes’ with respect to your pricing and service as they know that at any time you are likely to test the market.

 Will you recognize any of these sins in your business practices today?

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.

Today’s post is written by Heather Powell, Manager of the COE Department & Project Manager at SafeSourcing Inc.

6. Wrath – Vindictive anger; angry revenge.

 a. Wrath is wanting to hurt someone.  It is not anger, which is normal and is really frustration and rebellion at being powerless.  Wrath is  wanting to cause pain, and being motivated by this to actually cause pain.  A little bit, especially when driving, is okay.  Carrying a weapon and firing at both the stupid and insane people driving near you isn’t okay.

In e-procurement wrath can be defined as- not reading the small print.

In defense of the customer, this is most likely due to the enormous time constraints placed on them. However, that matters not if something goes wrong costing the customer money. What an expensive mistake it can be not reading the small print on contracts. Many customers have been left with debt for what they had believed to be ‘free’ services, shipping, and/or goods.

How to avoid this:

Never, ever, sign a contract without reading the small print. Ever. (Have we made the point)?! It really is that simple. If you’re not sure about some of the clauses, ask the supplier for a full explanation and keep asking until you are 100% comfortable you understand what you are signing. If you’re still not happy, engage a third party expert to review documentation for you. A small fee here might prevent bigger costs, and time consuming problems, later on down the line.
Do you recognize Wrath as a sign of sins in your business practices today? Stay tuned tomorrow for the 7th and final sin in e-procurement: Pride and how to realize and avoid it.

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.