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Procurement

6 ways to get a better handle on procurement management

If you’re in the logistics business, procurement is probably a key part of your operations, but unfortunately many companies don’t do all they can to ensure they manage those efforts effectively. For that reason, now is the time for companies to take a holistic look at how their purchasing employees (or departments) operate, and see if there are new standards to put into place that can help everyone get a little more out of their efforts.

The following suggestions should help you do just that:

1) Hire people who specialize in this kind of effort

Perhaps more important than anything else is ensuring the people in charge of purchasing have a background in such work, especially if you are expanding, according to CIO magazine. Even if your current workers have served you well in this role, they might still be able to do their jobs more effectively. Training or continuing education (on the company dime) can be a great way to keep moving in the right direction.

Is your purchasing department set up for success?Is your purchasing department set up for success?

2) Connect with more, better vendors

The novel coronavirus pandemic laid bare many of the weaknesses in companies’ supply chains, and if you haven’t done more to partner with a larger number of vendors in the past few months, now is  the time to do so, CIO added. In short, such an effort will help you stay agile and give you options to pivot to new fallback positions whenever a problem arises.

3) Digitize everything you can

The more you can do to get insight into your purchasing processes and continually review that data to improve workflows, the better off your entire organization will be, according to Kissflow. Often, a lack of data collection results in you not even realizing the ways in which you may be running into the same obstacles over and over again, so making this a priority in 2021 is a must.

4) Identify ways to reduce and control spending

Along similar lines, it’s a good idea to look at how you’ve spent money over the past few years and see if there are any ways to tighten that up, Kissflow said. Every dollar you save with a more efficient purchasing process can then go back into other aspects of your operation.

5) Create a hierarchy of vendors

When you are bringing more supply chain partners into the fold over the next several months and beyond, it is advisable to rank them so you know which company to turn to in Situations A, B, C, D and beyond, according to Acctivate. Some vendors may be great for certain orders, and poor options for others, so understanding how each can meet you needs will be highly valuable.

6) Make strategic tech investments

Finally, it’s wise to make sure your purchasing professionals have the latest and greatest when it comes to tech, Acctivate noted. That not only aids in data collection and analysis, but also helps everyone interact that much more efficiently going forward.

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