For strategic sourcing, the chaos faced by companies since March 2020 has had at least one positive point: they understood that they need to improve their relationships with their suppliers.
Purchasing teams depend on this good relationship to identify and select the suppliers that best meet business needs, leaving aside the lowest price and focusing on the final cost in order to optimize the value delivered by the acquisition process.
There are many challenges in finding the ideal supplier and also in correctly accounting for costs, as this involves considering factors that go beyond price, such as delivery times, taxes, logistics costs, among others.
Failure to take these factors into consideration can put the entire production schedule and product quality at risk, and this is the analysis that strategic sourcing does.
Reduce direct and indirect costs
Reducing costs is obviously important for companies and is perhaps one of the greatest benefits of strategic sourcing. This smart savings has a direct impact on profitability of an operation. The more the sourcing strategy can reduce costs, the greater the sales revenue will be.
Improve relationships with suppliers
Strategic sourcing has a global reach and seeks to make supplier management more efficient, reducing the complexity of this relationship. And one of the main roles of the strategy is to find the right suppliers to meet the company's needs.
By understanding the business objectives and understanding the capabilities of each supplier, it is possible to seek out the one that will add the most value to the company while building a lasting and collaborative relationship.
To achieve this, some performance metrics need to be analyzed to support future decisions. Likewise, it is necessary to adopt a strategy of continuous feedback to suppliers so that they know their strengths and weaknesses and look for ways to improve their SLA.
Additionally, strategic sourcing is also beneficial for suppliers as they have access to all the requirements and information needed to understand exactly what customers are looking for.
Gaining efficiency with strategic sourcing
It is possible to implement the strategy manually, using spreadsheets and memory to track suppliers and know all the details of their operations. Obviously, this dependence means decision-making errors caused by wrong perceptions that can harm the business, not to mention the lack of governance.
In this way, automating sourcing processes guarantees the Purchasing sector greater precision in choosing the ideal supplier and, consequently, finding a safe source of supplies, with good quality and at the lowest possible cost.
Automation eliminates the so-called buyer's feeling and helps the Purchasing professional have the correct information at hand to analyze costs, quality, production and delivery capacity, services offered by suppliers and other factors that you consider important to find the best supplier.
Reduce supplier risks
With the need to meet more complex business requirements and compliance standards, risk management related to suppliers needs to have a tool that helps them analyze the company's partners with a focus on avoiding interruptions in production.
With digitalization, more and more data is being captured so that strategic sourcing can generate insights that minimize supplier risk and allow companies to use this information to dictate the course of negotiations.
Make the best decisions
Decision-making processes in Purchasing become more efficient with the insights generated by strategic sourcing while making Purchasing processes simpler. In addition, it allows for integrated supplier management, improving communication between companies.
Strategic sourcing today plays a critical role in business success and helps Purchasing professionals find innovative ways to maximize profits and deal intelligently with the possibility of supply disruptions.
In an increasingly competitive market, finding ways to reduce costs, ensure and improve product quality, and be able to launch new products quickly, makes strategic sourcing a fundamental part of making supply chains more efficient and making businesses more resilient.
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