Archive for the ‘E-procurement’ Category

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Market Trends and Procurement!

Wednesday, February 21st, 2024

 

Today’s blog is by Margaret Stewart, Director of HR, and Administration at SafeSourcing Inc

Have you noticed your costs shifting in the market? It may be time to utilize external procurement professionals.

Staying on top and aware of market trends is paramount for businesses striving to maintain a competitive edge. Market trends encompass a wide array of factors, including consumer preferences, technological advancements, economic shifts, and regulatory changes. Amidst this dynamic environment, procurement emerges as a strategic function capable of harnessing market insights to drive business success.

As markets fluctuate, innovations and other economic forces force those in business to stay attune to these trends. Doing so can provide you with opportunities for growth, innovation, and adaptation. Procurement is not merely a transactional function focused on purchasing goods and services; it is a strategic imperative that can drive value creation, foster innovation, and mitigate risks across the organization. By harnessing market trends, procurement professionals can anticipate shifts in demand, identify emerging opportunities, and forge strategic partnerships that propel the business forward.

Procurement teams leverage market insights to identify suppliers that align with the organization’s strategic objectives, whether it be cost reduction, innovation, or sustainability. By conducting thorough supplier evaluations, negotiating favorable terms, and fostering collaborative relationships, procurement professionals can optimize the supply chain and enhance operational resilience.

In an era defined by rapid change and unprecedented uncertainty, businesses must embrace agility, innovation, and strategic foresight to thrive in the marketplace. Procurement, as a strategic function, plays a pivotal role in navigating market trends, driving operational excellence, and delivering tangible value to the organization. By leveraging market insights, fostering collaboration, and embracing innovation, procurement professionals can position their organizations for sustained success in an ever-evolving business landscape.

For more information on eProcurement and how the SafeSourcing team can help your organization with the changing market trends, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

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Have you noticed the price of chocolate lately?  

Friday, February 16th, 2024

 

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

With it being close to Valentine’s Day you may have noticed when you were out shopping that the price of chocolate has risen.  It might as well everything else is going up why not one of favorite snacks.  The cost of the main ingredient, cocoa, has been rising upward over the past two years and over the past year it has more than doubled.  This month it broke an all-time record from back in 1977.  The prices are surging so high that even the biggest chocolate makers are struggling to make profits.  Last week Hershey Co. announced that they are cutting 5 percent of its workers because of the historic cocoa prices and inflation-weary consumers helped lower their fourth quarter earnings.  One of the reasons behind the significant increase is the climate issues in West Africa where more than 60 percent of the global production is produced.  According to experts’ cocoa futures have skyrocketed, not only have they doubled in the past year it has also gone up an additional 40 percent since January.  According to a senior food and beverage economist, the rising cost of cocoa has made retail chocolate prices rise about 17 percent over the last two years and it will only continue to rise.  One company that produces 4-ounce chocolate bars stated that the bars were selling to $4 in 2020 and is now up to $5 a bar.  They also noted that it is not just the cost of the chocolate but also the cost of sugar, cocoa butter, packaging, and labor costs.

If you need help sourcing ingredients for your company, feel free to contact SafeSourcing.   We can gather all the necessary information for you and help you decide which company and product meets your needs.  If you would like more information on how SafeSourcing can help you, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

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Does your organization implement eProcurement Solutions?

Thursday, February 15th, 2024

 

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

In the fast-paced world of business, every dollar saved counts. Whether you’re a small startup or a multinational corporation, finding ways to cut costs without sacrificing quality is essential for long-term success. One area where significant savings can be realized is through efficient supply management. With the advent of technology, eProcurement has emerged as a game-changer in this regard, offering businesses a streamlined and cost-effective approach to purchasing supplies.

eProcurement (electronic procurement) is the process of purchasing goods and services electronically, typically through online platforms or software systems. Unlike traditional procurement methods that rely on manual processes such as paper-based purchase orders and invoices, eProcurement automates the entire procurement cycle, which can streamline to process and cut down significantly on time.

One of the primary advantages of eProcurement is its ability to drive cost savings. By leveraging online marketplaces, comparing prices, and negotiating discounts, businesses can secure better deals on their purchases. Additionally, eProcurement helps eliminate the overhead costs associated with manual processing, such as paper, printing, and labor, further reducing expenses.

eProcurement presents a compelling opportunity for businesses to achieve significant cost savings and efficiency gains in supply management. By embracing technology, streamlining processes, and leveraging data-driven insights, organizations can optimize their procurement practices and position themselves for long-term success in today’s competitive landscape.

Through strategic implementation and continuous improvement, businesses can harness the power of eProcurement to drive savings, enhance operational efficiency, and unlock new opportunities for growth and innovation.

For more information on eProcurement and how the SafeSourcing team can get you started, or on our Risk-Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

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Why use SafeSourcing versus other providers in the Procurement Space?

Thursday, February 1st, 2024

 

Today’s post is from a collection of data and other tools that SafeSourcing’s CEO Ronald D. Southard uses regularly in the pursuit of fresh content.

  1. Cost Savings: SafeSourcing can help businesses achieve cost savings through strategic sourcing and negotiation processes. By leveraging their expertise and technology, they will assist in obtaining better prices from suppliers than you can.
  2. Efficiency in Procurement: SafeSourcing offers tools and platforms that streamline the procurement process, making it more efficient and reducing the time and resources required for sourcing all categories of goods and services.
  3. Supplier Relationship Management: SafeSourcing might provide services to help businesses manage relationships with their suppliers effectively. This can include monitoring performance, addressing issues, and fostering collaborative partnerships.
  4. Risk Mitigation: The company may have tools and processes in place to assess and mitigate risks associated with the procurement process. This could include evaluating supplier reliability, compliance, and other factors that may impact business operations.
  5. Access to a Network of Suppliers: SafeSourcing could offer access to a wide network of pre-vetted suppliers in their SafeSourceIt™ Supplier Database. This can be particularly beneficial for businesses looking to expand their supplier base or enter into new markets.
  6. Technology Integration: If SafeSourcing utilizes advanced technologies, businesses may benefit from the integration of these tools into their procurement processes. This could include e-sourcing platforms, analytics, and other technological solutions embedded in the SafeSourceIt™ family of solutions.
  7. Compliance Support: SafeSourcing through regularly sourcing hundreds of categories may assist businesses in ensuring that their procurement practices comply with relevant or evolving regulations and industry standards. This can be crucial for avoiding legal issues and maintaining a positive corporate image.
  8. Customized Solutions: The company may tailor its managed services to meet the specific needs of individual businesses. This personalized approach can be advantageous in addressing unique challenges and optimizing the procurement process.

To learn more please contact a SafeSourcing Customer Services Representative.

 

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What is Shrink? It was a big subject at NRF 2024!

Friday, January 26th, 2024

 

 

Todays repost is by Gayl Southard, Gayl Southard VP of Administration at SafeSourcing.

“What is shrink? Inventory shrink is a loss of goods either due to theft, damages/spoilage or administrative errors on items moving from a manufacturing site to an end customer.  The shrinkage can be referred to as a hit to the margin or loss in profit.”1

  1. How do we Record Inventory Shrink? Between the last cycle count and the current period, your business may have Inventory loss. The physical Inventory is less than what is recorded in your books. “To account for this loss of Inventory via the perpetual accounting method, you would: increase the cost of goods sold and decrease the inventory but the difference for the recording period. Your balance sheet would show a credit to the inventory line then for the value that was lost. Showing that you have incurred higher expenses (cost of goods) and a lower gross profit will lower your taxable income.” You may prefer to record shrinkage separately. This would require IRS Form 4684 if your business is in the US.
  2. What Causes Shrink? Shrink is inevitable. It can be controlled through inventory management best practices. Shrink can occur by employ theft and fake sales. Retail theft may occur through petty theft, shoplifting, breaking and entering, and entering fake coupons. Shrink isn’t always caused by scams. It can be attributed to poorly designed operational procedures and standards. It causes a trickle down effect to the rest of the business including the warehouse and financial operations. Shrink can be managed by implementing internal controls. When hiring, conduct background and reference checks. Educate new employees on your policies and stance on employee theft. Some preventative steps may be surveillance cameras, valuable items secured in secured areas accessed by higher authoritative levels, separation of duties, anonymous reporting, checking on how trash is disposed, and audits.
  3. What Can be Done to Prevent Retail Theft? Using security cameras and mirrors through the space. Suspicious behavior may be spotted more easily. Bad promotion codes and fake coupons and online discount sites have increased the amount of manufacturing coupons on the net. Personnel will have to stay current with coupon scams.

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

Resources:————————————————————-

1 Colleen Roderick’s, inFlow

 

 

 

 

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HAPPY NEW YEAR 2024 from SafeSourcing; Your GLOBAL SOURCING PARTNER!

Monday, January 1st, 2024

 

picture of world

 

If you’d like to learn more about alternative sources of supply offshore or nearshore or anywhere around the world., contact a SafeSourcing customer services account manager to learn more about SafeSourceIt™ our 587,000 global supplier database and let us translate it into increased profits for you.

We look forward to and appreciate your comments.

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The Vital Role of Procurement Services in Business Success

Friday, November 17th, 2023

 

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

In the complex ecosystem of modern business operations, the role of procurement services stands as a linchpin for organizational success. Procurement, often regarded as a behind-the-scenes function, plays a pivotal role in driving efficiency, cost savings, and sustainability within businesses across industries. It encompasses the processes involved in acquiring goods, services, and works from external sources.

Driving Efficiency and Cost Savings

At its core, procurement is about optimizing the purchasing process to ensure the right resources are obtained at the right time and at the best possible cost. Leveraging procurement services allows businesses to streamline their supply chain, negotiate favorable terms with suppliers, and source high-quality materials or services while minimizing expenses. This efficiency not only impacts the bottom line but also enhances operational agility.

Strategic Decision-Making

Procurement services extend beyond mere transactional activities. They involve strategic decision-making that aligns with a company’s overall objectives. Procurement professionals evaluate supplier performance, assess risks, and identify opportunities for innovation and collaboration. This strategic approach helps in fostering long-term relationships with suppliers and mitigating potential disruptions in the supply chain.

Mitigating Risks and Ensuring Compliance

In an increasingly globalized marketplace, navigating through various regulations, compliance standards, and ethical considerations is a complex task. Procurement services play a crucial role in mitigating risks associated with supplier relationships, ensuring adherence to regulatory requirements, and maintaining ethical sourcing practices. This not only safeguards the company’s reputation but also reduces potential legal and financial risks.

Fostering Innovation and Sustainability

Procurement services contribute significantly to fostering innovation and sustainability initiatives within organizations. By engaging with suppliers to identify environmentally friendly materials or sustainable practices, businesses can reduce their environmental footprint and align with evolving societal expectations. Collaborating with suppliers on innovation leads to the development of cutting-edge products or services, giving companies a competitive edge.

Enhancing Supplier Relationships

Effective procurement services are built on strong supplier relationships. Cultivating partnerships based on mutual trust and understanding fosters collaboration, flexibility, and responsiveness. Strong supplier relationships often result in preferential treatment, better terms, and a more agile supply chain network, ultimately benefiting the organization’s overall performance.

The importance of procurement services cannot be overstated in today’s dynamic business landscape. Beyond simply acquiring goods and services, it plays a multifaceted role in driving efficiency, mitigating risks, fostering innovation, and ensuring compliance. Businesses that prioritize robust procurement strategies position themselves for sustained growth, resilience, and competitive advantage in the market.

For more information on what the SafeSourcing Procurement Managed Services team can offer you, or on our Risk Free trial program, please contact a SafeSourcing Customer Service representative. We have an entire team ready to assist you today.

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Bankruptcy is not fake news, and you might be next if you don’t pay attention.

Thursday, November 9th, 2023

 

Today’s post is by Ron Southard, CEO at SafeSourcing.

I read an article today on TheStreet.com by Kirk O’Neil titled Beloved fast-food chain files for Chapter 11 bankruptcy. Quite frankly it took a while to figure out what chain the article was referring to because it spent a lot of the article talking about the problems Rite Aide is having who also filed for Chapter 11. Then it went on to talk about  a furniture company that had to close 27 stores in 14 states and ultimately had to file for Chapter 7 liquidation.

The article did finally mention a restaurant chain that had to file for chapter 11 because sales have not recovered from the Covid Pandemic. How often have we heard this?

The fact is the fast-food sector of the retail is suffering, the model has changed quite a bit. How often do you go inside your favorite location to order your food (it is faster). Most of the takeaway or to go traffic is done through the drive-up windows. I’m pretty sure we are going to start seeing them again in the c-store space as they continue to try and capitalize on fresh food offerings, some of which have become outstanding. Even food service distributors are shifting their attention to the c-store vertical as a new source of business.

So, what’s the point? There is a lot of pain in all retail, it’s a war for the customers reduced spending. Thank the FED, The current Democrat Administration, and the Banks for that. However, where there is pain there is opportunity. If you look for it, it may just save some jobs or pay for that new self-checkout because you can’t find enough staff  for the shift work in 24-hour operations.

If you ask, you can find lower prices on just about everything. Capital Projects, Cost of Goods and Expense. Here’s the thing, you are understaffed for the job you have to do. There are other projects that the company will never get to.  You don’t have the time to do it yourself. That’s where SafeSourcing comes in. We know the categories as well or better than you do. We know where all of the suppliers are and have relationships with them, that you do not.

If you wan to reduce costs, I mean really reduce them so you can afford to do other things, Contact SafeSourcing. We guarantee our work, and our ROI is often greater than 10X and immediate.

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Where is the best place for retailers to spend their effort to improve profitability?

Friday, October 27th, 2023

 

Today’s post is an oldie but goody by Ronald D. Southard, CEO at SafeSourcing

The answer to this posts byline is of course all three!

Obviously, all retail companies would like to focus on all three areas and there are even sub sections of these top line areas that we could spell out as needing attention. The challenge is where to deploy already taxed resources?

It does not require an accountant to figure this out. If we assume that COGS or cost of goods and services is about 75% of top line revenue that would result in a simple gross margin of 25%. Based on a number of industries reports we are also safe using a shrink number of 3% of top line revenue.

This author is aware that there are a a few companies with shrink below 1% and cost of goods below 75% which means there are also companies with gross margin better than 25%. The obvious question is are these companies that solution providers want to target for profit improvement sales? Probably not.

So, let’s look at an example of shrink improvement with data analysis tools and process improvement tools versus cost compression with SaaS e-procurement tools. Let’s assume we have a company that does top line sales of $1B. Using a shrink number of 3% shrink would be $30M annually. If you were able to reduce shrink by a third in one year, profit improvement would be $10M. If this were a supermarket company with a 1% bottom line or $10M, improvement could be as much as 100%.

Now let’s take a look at reduction in cost. If we assume the same company has COGS of 75% or $750M and that we were only going to address 20% of that number or $150 and only reduce those costs by 20% which is slightly above industry averages the net profit improvement would be $30M or 300% improvement in year over year net profit. If we were only able to achieve 10% savings which is well below industry averages, net profit would improve by 150%.

I’ll leave the gross margin example for you to figure out. In the above case it is clear that attacking COGS has an impact on the bottom line of up to 3 to 1 versus addressing shrink with your already taxed resources.

If you are interested in an immediate impact to your bottom line, please contact a SafeSourcing Customer Services associate today.

We look forward to and appreciate your comments.

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Did you win Monday night’s Powerball?

Wednesday, October 4th, 2023

 

Today’s post is by Ronald D. Southard, CEO at SafeSourcing Inc

While I can’t provide the customer’s name, they are NOT a $5B retailer per yesterday’s posts example. However, they are smart and focused and may well be some day. They took SafeSourcing up on our No Risk Offer. Their ROI will more than pay for their contract moving forward. Most procurement teams do not believe these types of results are possible in the current economy. Most of your teams will tell you this is a waste of time. I’ll bet you could use another $338K right now.

Here are the results:

  1. Expense Category: Pilot Event Number One:
    1. Savings $298,270.80
  2. For Resale Category: Event Number Two:
    1. Savings $40,072.32
  3. Total Savings: $338,343.12
    1. ROI 26X

You can still test me, if you’d like, this link will come directly to me. Your team will tell you this is not possible. I guarantee that your odds are better than 1 in 292 million to win Powerball.

SafeSourcing is a Procure to Pay SaaS based provider of a number of e-Procurement solutions and associated white glove services that are part of our SaaS offered SafeSourceIt™ eSourcing suite. These include but are not limited to SafeContract™, SafePO™, SafeDocument™ and our SafeSourceIt™ Global Supplier Database that includes over 557,000 vendor/suppliers.

For more information, please contact a SafeSourcing Customer Services Associate.

 

 

 

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