How to Make Procurement More Efficient
By Mackenzie Oakley | December 21, 2021
Managing a procurement-focused blog is a great way to keep a finger on the pulse of the profession’s priorities. While many of our most popular topics are influenced by trends and events such as the pandemic, supply shortages, and economic uncertainty, procurement efficiency is an evergreen subject.
Purchasing professionals have a mandate to keep costs as low as possible, meaning they will never stop focusing on efficiency initiatives. In a past article, we’ve identified eight steps to help procurement professionals source faster and smarter:
- Identify inefficient processes
- Consolidate your supplier lists
- Educate your workforce
- Establish clear expectations for your supply base
- Accelerate your P2P cycle time with an automated system
- Standardize your procurement processes
- Increase local sourcing
- Simplify your supplier onboarding process.
The article also listed an alternative strategy for driving efficiency which I’d like to expand more upon today – how to make procurement more efficient by engaging with a group purchasing organization (GPO).
How to make procurement more efficient
As we round the corner into 2022, consider taking your efficiencies to the next level through the time-saving, cost-saving, and effort-saving power of group purchasing.
1. Instantly extend your procurement team with a GPO
The U.S. is currently experiencing an unprecedented jobs crisis. Catalyzed by the pandemic and exacerbated by the Great Resignation, recruitment is taking longer and costing more in a candidate-driven market.
Save your procurement function weeks of search-time and thousands in hiring costs by partnering with a group purchasing organization. At Una, we often say that a GPO is like a virtual extension of your procurement team, instantly increasing the number of resources available to you when you join.
In practice, this means you can give Una tasks such as bringing your tail spend under management, seek advice from our sourcing experts based on sophisticated spend analytics, and ask questions to help accomplish your goals.
2. Stop searching for suppliers in popular categories
According to McKinsey, a single supplier search can take around three months, with a sourcing professional “logging more than 40 hours of work” through the RFP process. Search times can vary wildly between businesses, and are (as a rule) longer in government procurement.
But for common, indirect categories such as corporate services, office supplies, shipping and logistics, facilities maintenance, and food distribution, there’s a much more efficient way. Finding and vetting suppliers is already done, saving your team potentially months of work.
3. Skip the negotiation
After spending multiple weeks searching for and vetting suppliers, procurement professionals face another time-consuming hurdle – the negotiation process. Depending on how the negotiation is conducted, this can involve multiple days of back-and-forth proposals and counter-proposals until a compromise is found.
At Una, we have thousands of pre-negotiated contracts in place which means there’s a good chance we have a working relationship with the supplier you’re looking for. This will improve speed-to-savings from months to weeks.
4. Cost analysis
As an extension of your procurement team, Una can help you skip the RFP process and see savings based on real data and real contract terms. It works by first getting a picture of your current spend, then getting visibility of what you could be saving by using one or more of our pre-negotiated contracts.
5. A seamless and repeatable experience
Una offers an attentive and efficient end-to-end member experience and ongoing support for future needs. Once you’ve been onboarded in our system and experienced the awesome power of bulk purchasing for the first time, we can simply “rinse and repeat” for additional categories.
Ready to start saving? Get in touch with Una to drive procurement efficiency and save time, cost, and effort.