procurement optimization Archives

Cutting down costs is a major challenge of any business, especially with the asset intensive organizations. Outsourcing Procurement with tech-enabled solutions has been turned out to be one of the efficient ways in reducing operations costs. To avoid the challenges that come with in-house procurement, it may be a good idea to outsource your procurement management. An efficient procurement process plays a crucial role in the success of a manufacturing business. It is challenging to produce certain parts and materials internally; therefore, you look for external assistance to produce those components such as contract manufacturers, who make things easier for your organization. Similarly, developing a successful procurement plan, on the other hand is tricky. And, given the time constraints, procurement might quickly become too much to handle. One approach is to hire more workers; while training those employees can be costly in terms of both money and time. With companies like OptimizeMRO, find procurement specialists available on demand and your procurement strategy with become more effective. Benefits of outsourcing procurement Fewer Overheads to pay: With in-house procurement teams, the organization requires to incur fixed costs on resources such employees, technology and team management. Organization also must spend money on payroll taxes and various employment benefits as per applicable compliance. And then comes the staff retention and re-hiring activities which in itself is laborious to replace human resource. Outsourcing, however, only involves paying for the services offered as a package, which includes the procurement team's pay, training, and you don't have to worry about attrition or compliance needs. No additional workspace:Hiring more employees often means organization need a bigger workspace to fit all employees. This may involve renting another office space, expanding your current place, or building a commercial space from scratch, all of which take time and money. Organization could avoid this problem by outsourcing a third-party support team who already have their own workspace. No Cost of Training Employees:The digital ecosystem is constantly evolving and each day with a new technology or update in existing technology. Training the in-house teams to keep them updated could come with a huge tag. However, this could be avoided by working with remote procurement / sourcing teams. Procurement Software Platforms:Today’s procurement technology platforms are available with multi-lingual cloud-based digital solutions that manage devices, processes, linking sourcing teams to suppliers, while also integrated with ERP / EAM systems. Procurement teams can fully automate most mundane activities such as e-requisitions, approvals, purchase orders, invoices, and payments on one centralized platform. Sourcing teams has a better visibility of entire procurement process, they could easily communicate with each other and vendors quickly, and overall experience a smoother and more optimized process. Digitally Enhanced Services:While technology has certainly been a catalyst for change, its rapid evolution sometimes means that the organization aren’t always able to keep up with the latest developments in technologies. Therefore, companies such as SAP that have already offered procurement digital solutions find it necessary to add to their existing service portfolio a digital service aspect too. However, creating solid professional relationships with the vendors can deliver mutual benefits. It can also help to align supplier objectives with an organization, increase the likelihood of cost savings from the supply chain and enable the organization to negotiate better contract terms with the vendors. The key is to identify suppliers that are the most important to the organization. This method takes a long time and consumes a lot of resources if you don't have the necessary tools. But with a comprehensive supplier relationship management solution, organization could strategically segment the vendors into tiers based on their importance to the business operations. The multi-tiered method identifies the level of active management required by each supplier. Do want to learn more about how OptimizeMRO can help optimize your procurement processes? Talk to one of our procurement specialists today! Contact Us

Elevate savings with Procurement Outsourcing and Digital Solutions

Tag Archives: procurement optimization

Elevate savings with Procurement Outsourcing and Digital Solutions

Benefits of Procure-to-Pay automation

Elevate savings with Procurement Outsourcing and Digital Solutions

Tag Archives: procurement optimization

Elevate savings with Procurement Outsourcing and Digital Solutions

Benefits of Procure-to-Pay automation

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