The Purchasing Department is an essential part of any company – whether small, medium or large – even when its main function was to reduce acquisition costs.
A recent report by US consultancy firm AT Kearney says that 90% of financial directors admit that Purchasing Management areas are active in their companies, but that they still need to prove to stakeholders that they do not exist solely to find lower prices on the market.
The quality of products and services purchased, control of delivery times, supply chain management and, of course, cost reduction are among the sector's strategic responsibilities.
But there are many other potentialities to be observed by companies and by Purchasing managers themselves.
Search for efficiency
A study by another American consultancy, Levvel Research, shows that most companies still maintain many manual purchasing processes, such as requesting and verifying orders and confirming payments, with obvious implications for the experience of the internal customer – the employee.
Since the Purchasing Department is responsible for providing goods and services when they are needed, it is also its responsibility to take customer satisfaction into account. To this end, its mission is to support the company's goals and objectives. How can this be done? Here are some alternatives:
Improve relationships with suppliers
Maintaining a good relationship with suppliers is the best way to ensure quality services and, as a bonus, optimize and improve process efficiency. Not to mention that, this way, it becomes easier to recognize better prices, deadlines and low risks.
Inventory information
Purchasing Management needs to reconcile acquisition planning, its core activity, with project execution, supplier relations and price negotiation. To be successful, it can count on the help of technology to analyze information and influence decision-making.
Social Responsibility
Ecological and socially responsible initiatives are increasingly valued in society, and companies need to reorient their processes in this direction, being able to track their inputs from their origin so that the entire supply chain maintains a standard.
Training
Improving purchasing skills also helps to carry out more assertive negotiations and, therefore, reduce costs – which is something managers are always looking for.
The Purchasing Cycle
Optimizing a company’s purchasing processes results in improved efficiency and increased profits. However, it can also generate intelligent savings through improved insight into the organization’s budgets and spending practices.
Furthermore, process optimization provides Purchasing Management employees with all the appropriate tools to carry out their work and for the sector to evolve, not to mention training and development programs.
If a large purchasing process cycle is essential for any company, especially for those with many suppliers and departments involved, investing in an e-Procurement solution is also ideal for optimizing the department.
COSTDRIVERS has over 200 clients in around 40 countries and specializes in transforming data into insights for strategic decision-making. Learn more about how we can help your company: Contact us and get to know our services.