Unlocking the hidden opportunity of procurement within your business
Updated: Feb 18
Our MD has recently featured in the East Midlands Chamber monthly magazine Business Network. Click here to review the article.
Here he talks about and sympathises with SME owners who are faced with huge day to day challenges, from meeting customer requirements, to managing HR issues, to operations, that their ability to focus on anything else is hard.
But in doing so they could also missing out on some real hidden opportunities which could help them meet their business objectives.
One hidden opportunity is reviewing how goods and services are purchased within their business, and understanding how they can leverage their position better to create a competitive advantage for themselves.
The starting point is to know your spend data, and analysing it to create an insightful and powerful platform from which to base your strategic approach. This will enable you to focus on the right areas to reduce costs within in your business and leverage improved working relationships with your suppliers that create additional value in your business.
This strategic approach can yield huge benefits, and helps transform your purchasing teams into a procurement function that truly drives value within your business.
The link to the article above provides a more in-depth look at what this means, but by taking this approach with clients we have made huge improvements to their business.
With one client recently, we have helped them increase their cost reduction plans for 2020 from £100k to £450k, an increase of over 350%. This has been based on a bottom up detailed review of their spend and looking at the opportunities to reduce their spend. There are many other benefits as we work to reduce the purchasing administrative burden and reduce the number of PO's/invoices. We are also embedding a process of supplier selection based capability, where quality control, capacity management sit at the core of that process, helping to mitigate any potential risk of poor supplier quality or delivery.
For another client we have reduced the unit cost of one of their products by 67%. Utilising the clients growth and future plans to drive cost from their product. All delivered through a strategic sourcing approach and using spend data to drive the focused improvement.
If you are concerned by the future state of the economy, facing pressures from customers to reduce pricing and suppliers seeking to increase costs, then you need to mitigate that now!
Is it time for you to unlock the hidden opportunity in your business, and but your spend data at the heart of your business?
Contact us today to see how we can help your business gain a competitive advantage!
0330 311 2601