Tips

5 Tips and Tricks on How to Save Time and Money in Procurement

The time and money spent with a supplier can often be inflated through some unfortunate means. Whether it’s lack of organization on our end or our supplier stumbling with some orders it’s a thing that should be taken care of. Oftentimes, resolving these situations can easily cut down the overall time and costs by quite a decent margin. Let’s look at some examples on how you can implement that.

1. Ask for Discounts From Supplier

Source: ctfassets.net

It’s usually expected that you will end up doing business with the same supplier over multiple situations. That means you are a reliable source of income for them as well as being a consistently involved customer. This does give you some form of patterns that can be recognized by the suppliers. What this means is that you are a reliable person to do business with which can allow you to barter about prices.

The approach you should take shouldn’t be one where exclusively you benefit. The best way to get a deal through is by giving them some ways of increasing the interactions you two have. This can most reliably be done by promising to place higher orders if they give you a discount to the whole batch. Of course, the increase doesn’t have to be insanely high. It’s possible to only slightly increase it while still maintaining the benefit of the discount you’ll get.

The increase in orders can also be very fruitful if you are experiencing an uptick in sales. At the same time you get to bolster the overall sales while also securing a much better value for your money in the orders.

2. Avoid Spending Leakage

There are various factors we should keep in mind. Among them, spending leakage is rather important. The spend leakage will happen when we spend money outside of our contract. That means going out of the standard spendings and entering a type of spending that will likely end up costing us too much cash.

Spending leakage will often happen due to lack of control and monitoring of spending being conducted. No matter how big the spending is, you should always keep it in mind when engaging with any type of extra costs that weren’t in the initial engagement. At times, you will end up in a situation where the spendings are simply the cause of mistakes made by the supplier. Otherwise, it will come from our own inaccurate orders that end up costing more.

Paying extra attention and double-checking is mandatory in order to stop spending leakage. Counting through the orders and making sure everything is properly managed is key to spending less money. Additionally, if the supplier constantly messes up with orders make sure to have a talk with them. Whether it’s accidental or malicious practice, it pays to talk it out with the supplier. If the supplier keeps giving you wrong orders, it may be time to switch to another one.

Another way to prevent this is to get a very reliable and good supplier. If you need Yiwu product sourcing then your choice should be justchinait.com. This supplier offers great deals without compromising quality.

3. Make Sure to Modify Orders

Source: cloudinary.com

It’s not rare that we end up purchasing way more than we need or simply order wrong things that aren’t as profitable as expected. This can cause quite a loss of money no matter what our supplier offers. Without early and eager engagement with this problem, we could end up losing quite a lot of cash each time we order items from the supplier.

To prevent this from happening, pay extra attention to the items you order. Go over each item on the list and revise its importance and utility. Whatever’s not fulfilling an important job can fly right out. Purchasing requirements change depending on the other expenses of the item too, such as cost of its storage and the longevity of it. It’s good practice to cut down on costs in this way because it could also free up some space for ourselves in addition to saving cash.

Try to be as objective as possible, sometimes it’s difficult to get the right feel for the item’s importance but if you take time to engage with your current orders it should be apparent what can stay and what has to go. No matter what the item is, look over it twice before deciding what to do with it.

4. Make a Central Storage

With multiple sources of storage, we get into the problem of extra costs. The costs can be especially felt if we also need to transport the items to another area, making the transport cost us exxtra. Sometimes the extra space is very much necessary considering how storage can unravel and overwhelm us but in other situations we should consider the overall costs and whether they can be cut.

In some situations, it could be possible to shut down some smaller storage spaces that we utilize and transport all those supplies to a single one. This is centralization of storage and it can heavily cut down both storing and transporting expenses that the supplies bring with them. Regardless of the items you store, it pays to look out for the cheapest yet most spacious storage to centralize the storage and get the work done quickly.

5. Rely on Your Employees for Cutting Costs Too

Source: forbes.com

No matter how much attention we pay to the interactions between our business and the supplier, it is impossible to notice all the little bits. This can become a problem if some grander issues keep slipping from us.

Make sure to engage all of your employees in the cost reduction experience. They can probably spot extra bits you miss on the consecutive checks they make. Employees can also quickly give you necessary information when it comes to the overall experience with your storage’s remaining items. Supplies can be managed through this approach. Often leading to even less orders without there being any lack of supplies to sell.

Related Articles

Back to top button