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How to Know When It's Time to Hire a Procurement Expert
Product procurement strategies help companies maximize their spending power while providing access to the best products and vendors. Businesses spend years building relationships and working through data to make the most of their situations, but without a procurement expert on board, most companies struggle to get as much value as possible.
Savvy business owners understand their blind spots and know when to complement their weaknesses with strength from a new hire or partner. Why waste time and money scrounging for better deals when a procurement expert could come in and secure better savings in a fraction of the time? Procurement experts don’t just save money: they use their knowledge of the industry to ensure businesses get access to higher quality products and more reliable vendors, too.
If you’re on the fence about whether to hire a procurement expert, consider whether your business experiences any of these situations.
You want to leverage your buying power with a group.
As an individual company, you only have so much leverage over your vendors. Even if you run a large operation, most vendors would rather please a crowd to diversify their accounts than put all their eggs in one basket. By joining a group purchasing organization, or GPO, you can maintain your company’s autonomy while gaining access to steep savings and better deals than you could secure on your own.
A procurement expert can tell you which GPOs in your industry (or even outside your industry) would best fit your business. Not only that, but a procurement expert can also help you make the most of your new GPO membership to realize even more savings or gain access to higher quality products. When your company’s reputation depends on satisfied customers, don’t switch providers without consulting an expert who understands the landscape and can help you adapt.
New market pressures have hurt your bottom line.
Has a shifting market cut into your profit margins? Tariffs on Chinese imports, an uncertain stock market, and standard industry pressures can all turn healthy performance into a struggle for survival.
Your procurement strategy is the lifeblood of your business. Without products and reliable sourcing, you cannot meet the needs of your customers. With a procurement expert, however, you can navigate challenging waters and maintain a steady influx of critical supplies in even the most tumultuous times.
Procurement experts don’t just help during times of hardship, though. When new competitors enter your market (or when you enter someone else’s market), your business faces new sets of challenges. The right help ensures you never have to worry about your procurement strategy, freeing you to spend less time worrying about details and more time planning strategies to grow your business.
Regulatory shifts have affected your operations.
Environmental, social, and market regulations dictate how companies can operate, to whom they can sell, and from whom they can buy. As regulations change, you may find yourself struggling to match past performances after getting locked out of previous options. You may not know where to turn — especially if regulations shut down a partnership you have used for years — but procurement experts know the wider market and can help you make the switch.
Once you bring in a procurement expert, you may discover some internal noncompliance on your own. When that happens, take the opportunity to make the correction. Don’t assume you will continue to get away with something just because no one has noticed yet. Regulatory oversight improves all the time, and the earlier you fix inconsistencies, the safer your business will be.
You’re ready to make a big move.
Is your company ready to enter a new market? Do you plan to acquire a longtime competitor? Maybe you have finally decided to expand your operations overseas. Whatever the case may be, big moves require big preparations. Going in blind could spell disaster, but arming yourself with the partnership of a procurement expert allows you to move confidently in the knowledge that your supply chain will remain reliable in transition.
Not every big move involves a change in geography. If you have noticed your profit margins slipping or have begun to lose customers to a competitor at greater speeds, consult with a procurement expert to see how you could save money on supplies or increase the quality of your products. Today’s customers expect the best, and to meet that expectation, businesses must work diligently to ensure their offerings measure up.
Not sure whether a procurement expert could help your company? Look at your operations, think about where you’d like to improve, and call around to get a few quotes. Most procurement experts will happily provide free estimates for services and tell you where they think they can help. With the right partner at your side, you can secure your company’s future and weather any storm.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes.