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

What indices do you use to assist in your category development.

Often you can build your own CDI from data contained in many indices that are available via the web such as the Consumer Price Index or CPI, Gross Domestic Product or GDP and The Purchasing Managers Index or PMI that we discussed yesterday. Elements of each my find their way into your own custom Index od Category Development Index.

A Category Development Index, or CDI, is a trend analysis that indicates the turnover of sales of a given product category in a specific area. The CDI can give vital data for marketers to allocate advertising to specific areas maximizing product category knowledge and profit. The category Development Index is often used in conjunction with the Brand Development Index or BDI.

At SafeSourcing we often use a variety of indices in the development of our client-driven eRFI, eRFP and eRFQ or Reverse Auction strategies.

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. To learn more, please contact a SafeSourcing customer services associate.

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

Do you use The Purchasing Managers Index in your sourcing strategies? Do you know what it is?

This useful index is one that many purchasing managers and other procurement knowledge workers use to keep up with the ever-increasing speed of change in our area of expertise.

The Purchasing Managers’ Index (PMI) is an index of the prevailing direction of economic trends in the manufacturing and service sectors. It consists of a diffusion index that summarizes whether market conditions, as viewed by purchasing managers, are expanding, staying the same, or contracting. The purpose of the PMI is to provide information about current and future business conditions to company decision makers, analysts, and investors.

At SafeSourcing we often use this data in the development of our client-driven eRFI, eRFP and eRFQ or Reverse Auction strategies.

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. To learn more, please contact a SafeSourcing customer services associate.

Sources:

Investopedia: Purchasing Managers’ Index (PMI) Defined and How It Works (investopedia.com)

Wikipedia: Software as a service Wikipedia

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

Every day, I talk with buyers of all sorts about their procurement processes. While I do get to hear some really interesting perspectives, I also get to hear some really old perspectives over and over again. One of the worst and oldest offenders is price matching.

It goes like this:

A buyer feels that the price she pays for her product or service is higher than it should be. So, she asks a competitor to provide her with a quote. She then takes that quote to her incumbent vendor and asks them to beat or match the price. It’s simple, and it is technically successful, because it delivered savings. I hear that this often generates 5-15% discounts. I’m not impressed by this.

What to do instead?

Testing the pricing in the market by asking for a quote is alright. So is asking your incumbent vendor to sharpen their pencil. But, it’s at this point that there is room for improvement. Any time your vendor signals that they are willing to offer a better rate like in the example above, they are tipping their hand. We now know that they are willing to reduce their margin to keep your business and that they do, in fact, have margin to reduce. It’s at this point, that we recommend applying a lever in the negotiation. An RFQ is a great lever because it creates an environment where the vendors are forced to compete live against each other for the lowest cost. Why have a vendor match a price and manually facilitate this slow type of back and forth? Let the vendors duke it out until they are done. Go grab some popcorn watch it happen. This will probably increase your savings by at least double.

Whatever you do, don’t settle for negotiating tactics that should have died with the dinosaurs. Modernize and use the tools at your disposal to win better.

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.

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

Life-Cycle Costing is a procurement technique which considers operating costs , maintenance costs, acquisition price, and other costs of ownership in the award of contracts to ensure that the item acquired will result in the lowest total ownership cost during the time the item’s function is required. Also considered in life-cycle costing is the sum of all recurring and one-time (non-recurring) costs over the full lifecycle or a specified period of a good, service, structure, or system. This includes purchase price, installation cost, operating costs, maintenance costs, upgrade costs, and remaining (residual or salvage) value at the end of ownership or its useful life.

If you’d like to learn more about our service offerings that make it easier to understand your total product and or services costs, it’s time to learn more about SafeSourcing.

To that end, SafeSourcing is a Procure to Pay SaaS based provider with E-Procurement solutions and services that are part of our SaaS offered eSourcing suite like SafeContract™, SafePO™, SafeContract™ and our SafeSourceIt™ Global Supplier Database with over 500,000 vendor/suppliers. To learn more, please contact a SafeSourcing customer services associate.

Today’s post is from Ron Southard CEO at SafeSourcing Inc.

Aggregation is a process whereby a number of a firm’s smaller projects are combined and treated as an individual project. The main purpose of aggregation is to ensure accurate reporting and compliance with regulations regarding the permitted levels of provisional limits for a single commodity.  Aggregation is also a total made up of different parts from various sources.

The SafeSourcing Inc Collaborative Aggregation Philosophy supports the thought that disparate buying groups can on occasion work together successfully as a loosely coupled purchasing organization in order to combine volumes for better pricing consideration by suppliers. Often the specifications for these events need to be very similar in nature such as office supplies or other similar categories. Separate shipping charges and other terms and conditions may apply to each participant. Participants must support single supplier award in order to ensure the success of collaborative aggregation events to ensure that suppliers honor their prices.

We have recently seen a lot of activity in this area with dramatic savings for spends of all different sizes. Some categories have even achieved savings of over 30%. That’s 30% better than what you negotiate.We mapped these savings and are seeing some retailers with as few as 20 stores paying less than some very large customers who ran these categories during the last two years.

The markets are ripe! If you would like to learn more about how our customers and suppliers collaborate and aggregate to work together, please contact SafeSourcing.

Source:  www.fitchtraining.com

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

Last month, I shared a small list of categories as an example of where SafeSourcing’s clients have been successfully sourcing their needs using our eProcurement tools. That list was meant to represent a sample but was certainly not exhaustive.

The reality is that over the past several months, we have seen a reduction in the number of vendors who are not able to quote in our customers’ RFQ events across nearly every category we source. Here again is that list I shared last month. Below, I will share a little more about what we are experiencing.

1. Paper Coffee Cups
2. Waste Removal
3. Equipment Rentals
4. Plastic Cutlery
5. Labels
6. Print Fulfilment
7. Bottled Water
8. Retail Displays

Again, this is just a sample. We are adding to the list daily. There are only a few categories that exist that I would consider to be caveats, which is an incredible improvement over this time last year.

One of the most noticeable factors (from SafeSourcing’s point of view) is vendor participation. We are souring categories today that have dramatically improved year-over-year. An example is sausages. Last year, sausage vendors were barely able to commit to volumes, let alone quote competitively. This year, we are seeing the full roster of potential vendors lining up to earn our customers’ business.

I am not here to talk about the factors today, I am just pointing out that there are many positive signs and from SafeSourcing’s perspective, you should be seeing very few supply chain challenges at this stage. If you think you are still experiencing supply chain issues and wonder if others are seeing the same, let me know and we can trade notes on the categories.

For more information, please contact SafeSourcing.