4 Steps to Improve Procurement Efficiency
Procurement does not have to be the difficult, involved process of yesteryear. Instead, today’s procurement processes are innovative, cost-effective, and efficient.
Getting the right supplies at the right time and in the right location can be done with ease and sustainability – as long as you have the right procurement team.
Here are 4 steps to improve your procurement efficiency and, in turn, maximize profits.
Analyze Your Current Processes
Before you can take steps to improve procurement efficiency, you have to determine where your inefficiencies are. What is causing bottlenecks? What areas need to be addressed? Are you spending money wastefully in certain steps? Do you often find your team having to secure unplanned procurement due to poor planning?
Not only can poorly run and unorganized procurement slow you down, but they can also cause your bottom line to take a big hit.
Review your current processes from every angle and collect all pertinent information. This will allow you to see what changes can be made to create a more efficient system.
Review Your Purchase Orders
Depending on your system, you could have employees in your procurement department issuing one purchase order after the next. There will be no order or organization – and it may, in fact, lead to slower processes.
Every time a purchase order is done, it may feel like the right thing to do. Something was needed, the purchase was made, close out the order, and move on. It means your team is on top of everything, right? Not exactly.
It becomes more difficult to monitor all types of small supply orders. And, not taking the time to review purchases before they are made means that you are likely having downtime in some areas waiting on supplies, as well as wasted time creating single P.O.s.
By reviewing and monitoring, you are able to see the purchases, analyze their use, and put a plan in place for the next order. This creates a flow and will allow you to be more effective in keeping everything up and running efficiently.
Look at Your Sourcing Strategy
Next, take a look at your current sourcing plan. Determine what drives your plan and whether or not it is easily adaptable when there are changes. Business can change with a moment’s notice – how quickly can your current system keep up?
Review your suppliers, your current procurement processes, and the current market to make sure that your sourcing strategy is solid. If it is not, now is the time to make changes.
Many have found that turning toward a professional procurement service is highly beneficial in creating this strategy. It takes the pressure off of your procurement department and places it on the professionals.
Expand Your Reach – Go Global
When you stick to a procurement strategy that does not include the global market, then you are limiting your business and its ability to be efficient.
Expand your reach into the global market. Here you may find more suppliers that grant you the opportunity to consolidate. In other words, you would have fewer suppliers to monitor and shipments to follow. This reduces risks within the supply chain so that things can keep moving.
Those looking to take this step and expand their reach to reduce inefficiencies should consider an established international procurement service. Choosing the right one will get you access to suppliers around the world who already have established and nurtured relationships. The supply chain is already in place – so you won’t be starting from scratch.
Logistics of securing your international procurement will be left in the hands of specialists – which will give you the confidence you need to improve your efficiency.
Improve Efficiency with DXL Enterprises
Ready to improve your procurement efficiency? DXL Enterprises had decades of experience in providing global procurement services to companies just like yours. We have established ourselves with suppliers around the world so that you can secure what you need when you need it.
To learn more or get started, contact us today at (201) 891-8718.