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Mar 10
BPO for SMB

Procurement Managed Services for SMBs

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SMBs Can Leverage Managed Services to Improve Procurement

As important as the procurement function is for companies to purchase the products and services they need in a compliant, cost-effective way, many businesses face the challenge of dedicating enough resources to procurement.

Fortunately, procurement doesn’t always have to be managed in-house. Just like other functions ranging from accounting to marketing to technical support can be outsourced to third-party partners, many companies — especially small and mid-sized businesses (SMBs) — benefit from leveraging business Managed Services for procurement.

Save Time and Money

Outsourcing procurement to a trusted partner can free SMBs up from challenges such as:

  • Finding qualified procurement staff
  • Implementing and managing procurement technology
  • Sourcing vendors
  • Analyzing spend
  • Assessing procurement risk

SMBs may also be able to customize their Managed Service relationships, so if they do want to be in control of analyzing areas such as spend through their in-house finance team, they can still benefit from letting their Manage Service partner focus on areas such as vendor risk management.

By not having to dedicate the resources to all of these areas, companies can save approximately 30% of their time and money, as employees can instead focus on core business functions such as sales.

Gain a Competitive Advantage

In addition to saving time and money through Manage Services, companies that outsource procurement can often gain competitive advantages by leveraging the expertise of their Manage Services provider.

Across outsourcing as a whole, beyond just procurement, a Deloitte survey finds that cost optimization is no longer part of the top-five criteria for outsourcing. Instead, companies are more often turning to outsourcing to gain a competitive advantage. In 2018, 49% of organizations moved more services to outsourced providers that innovate, compared with 20% in 2016, so this is becoming increasingly important.

With Procurement Manage Services, service providers can help your organization innovate in many ways, such as helping you gain the products and services you need to target new market segments. A procurement Manage Services provider can also help you gain spend insights that can inform overall budgets and help you find innovative ways to reduce costs, such as by procuring technology tools that have a lower total cost of ownership over their lifetimes.

Elevate Your Procurement With Premikati’s BPO Services

Premikati is one of only six SAP® Ariba®Manage Services partners, and we have the experience and technology to handle your procurement needs. Leveraging SAP® Ariba®as the underlying procurement platform, combined with our in-house expertise, we can quickly help SMBs gain the services of a full procurement department in a cost and time-effective manner.

As you focus on your organization’s growth, we can provide the procurement support you need to scale up while staying on budget. And over time, if you decide to bring some procurement functionality in-house, we can adjust our service offering to meet your needs so that procurement can always be a source of strength for your organization, not a burden.

To learn more about how Premikati can lift your procurement capabilities through Manage Services, please get in touch with our team.

Feb 18
procurement automation for smbs

Procurement Automation: Best Bet for Growth for SMBs

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Procurement Automation: Your Best Bet for Growth

Is there a way to optimize your procurement processes without having to make a massive investment in IT? Can you eliminate manual processes and their associated errors? Is there a way to eliminate expensive invoice processing?

It goes without saying that procurement processes can involve a wide variety of third-party vendors such as business partners and consultants, along with legal, supply chain management, and various department needs. Yet, data can be difficult to locate and the success of a procurement process may simply revolve around the fact that no one complained – yet.

Unfortunately, many SMBs spend a large portion of their sales revenue on procurement. Nonetheless, simple enhancements – such as automation – to the procurement process can perform the double duty of reducing costs and boosting productivity.

For SMBs, with their limited resources, the focus is often on overarching operations as opposed to specific procurement business functions. But, when you can empower your procurement team with an automated tool, then you can improve supplier relationships and make the right purchases for your business – on a more consistent basis. Further, all parties are satisfied.

When you utilize automated procurement, you can prevent your teams from engaging in trivial tasks so that they have more time to focus on their core functions and responsibilities. Also, you decrease human error.

Certainly, these are all specific reasons why many SMBs are opting for automating procurement, but there are many other advantages as well. Keep reading to learn more. 

Get Out of the Time Rut

Within the procurement cycle, or purchasing cycle, there are several stages such as research, bidding, vendor selection, negotiations, and approval. Depending on the current processes you already have in place, this can take much more time than necessary.

Why not speed up your processes with procurement automation? You could reduce the cycle by days, or even weeks. If you’re interested in adopting lean principles, automation would be the route to take. 

Plus, there are huge amounts of paperwork that needs management. In contrast, procurement automation can save time by transitioning documents from paper to digital. Not only do you save on paper and physical storage costs, but you inherently speed up all your cycles and processes.

Get Your Supplier Relationships on the Same Page

For the health of your SMB, it is vital to have strong supplier relationships. Although, this can be difficult in a highly competitive environment. To get there, you need true transparency. The good news is automation enables real-time interaction and order tracking. In addition, an automated system lets your suppliers respond more quickly and your company can select a supplier more quickly. Moreover, the process is transparent for all parties involved which means a much faster resolution process in the event of a complaint or misunderstanding. It is a win-win situation for all.

Monitor Every Interaction

When your company opens up a bidding war, this means you increase your chances of finding a vendor who can meet your budget. At the same time, it can get quite complicated to manage every interaction with all of your potential vendors. Further, no one likes filtering through hundreds of email messages trying to find the most recent interaction. Unquestionably, this is a scenario where mistakes can happen and messages will get missed.

With an automated procurement tool, you can quickly access all associated documents and RFP responses. In fact, you can even monitor every single interaction in real time.

Enjoy More Control

SMBs often face the daunting challenge of limited visibility during one-or-many stages of the procurement process. Invariably, low visibility can become even more prevalent during indirect procurement. One of the quickest ways to overcome this hurdle is with an automated procurement tool.

It’s imperative to have a visual representation of how much you’re spending on every purchase. Many SMBs have finite resources which means it would be quite beneficial to determine where you could cut back on expenditures. As a result, you feel more control over your budget and can improve your revenue outlook.

How Can You Tell if Your Procurement Processes are Ready for Automation?

Part of the decision-making process around an automated procurement tool is knowing which of your tasks are ready to be automated. So then, it is critical to execute a thorough assessment – and analysis – of your current processes and which are redundant/repeatable where automation can take over to save both time and money.

For instance, if your company requires a lot of legal input during the buying process, then you could automate this portion by utilizing pre-approved negotiations so that your legal team can focus on higher-level tasks.

There isn’t any reason why the SMB procurement process should not replicate the enterprise in terms of purchasing, employee training, and automation. SMBs want to grow, and automated buying practices help to provide transparency, facilitate tracking, offer convenient reporting, and most importantly, assist in managing costs to set the stage for expansion.

Final Thought

Searching for a comprehensive automated procurement tool to effectively manage your processes? When SMBs streamline how they purchase goods and services, they create more value and become an organization that vendors – and customers – enjoy.

Learn how an automated system can streamline your procurement process – contact Premikati today for a free consultation!

 

Dec 31
cut procurement costs Premikati marketplace

Cut Procurement Costs – Not Quality

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A New Year’s Resolution to Cut Procurement Costs, Not Quality

 

Many people take on personal new year’s resolutions such as to lose weight, but what’s often more important than the number on the scale is someone’s overall health quality. Similarly, many businesses want to cut costs, but focusing just on reducing expenses may not be the most sustainable way to grow overall.

For example, switching to a vendor that supplies lower-quality products, such as for IT devices, may reduce costs in the short-term, but if those devices break down faster, it can cost more overall to repair or replace them.

Thus, companies looking to save money in 2020 should make a new year’s resolution to cut procurement costs without cutting quality. To accomplish this task, businesses can leverage:

    • Purchasing Power: Either by consolidating spend with fewer vendors or by leveraging group purchasing organizations, companies can often obtain a discounted rate for purchasing the same products and services. For example, making tail spend purchases through a B2B marketplace can enable businesses to obtain better rates from suppliers based on the combined spend of the marketplace’s multiple clients. If a small or medium-sized business tried to negotiate rates based on just their own spend, they would have less leverage than a marketplace has when setting rates with suppliers.
    • Spend Insights: As companies improve their ability to track spending, they can more easily identify pure cost-saving opportunities that have no bearing on product or service quality. For example, using spend insights to identify erroneous purchases, such as incorrect pricing or accidental orders, allows companies to reduce costs without affecting any other areas of their business. Similarly, spend data may show that companies are going over budget with purchases that do not add much value. From there, businesses can implement stronger cost controls so that unnecessarily expensive purchases do not go through.
    • Productivity Gains: In addition to the direct cost savings that can come from negotiating better rates and cutting waste, businesses can also save on expenses and potentially increase revenue through productivity gains. For example, if a business can process orders and invoices more efficiently through a procurement marketplace, they may be able to reduce the costs of using a third-party accounts payable provider. Moreover, freeing up employees’ time to focus on more revenue-generating tasks can help companies grow, without adding expenses.

Start Saving With Premikati Marketplace 

To simplify tail spend purchasing and cut procurement costs without hurting quality, businesses can turn to Premikati Marketplace, which runs on SAP Ariba™ Buying and Invoicing. The platform provides an easy way to access great pricing on quality products and services, while also allowing businesses to implement cost controls, gain rebates and streamline the overall buying process. Altogether, businesses can reduce tail spend costs by around 30% through this marketplace.

To learn more about how Premikati Marketplace can help you achieve a new year’s resolution of cutting procurement costs without cutting quality, please get in touch with our team.

Sep 12

Intelligent Spend Management

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Premikati’s COO and General Counsel Chad Buchanan talks about the challenges that companies in the mid market face and their unique approach to intelligent spend management utilizing SAP Ariba technology.

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