Tag Archives: buying

Out Of Savings Ideas? Here’s How To Unlock A New Level Of Buying Power

If you feel like you’ve exhausted every avenue for finding cost savings, a Group Purchasing Organization could be the answer to your challenge.

By Andrew Paul Deer /Shutterstock

There’s a gripping scene in the last chapters of Jules Verne’s Around the World in Eighty Days where the ever-dapper hero, Phileas Fogg, finds himself on a steamboat from New York to Ireland. Going full steam against hurricane winds, the vessel runs out of coal after a few days but Fogg, desperate to get to London in time to win a wager, buys the steamer from the captain and launches a desperate plan.

He instructs the crew to feed the furnace with all the wooden parts of the ship – the cabins, bunks, masts, rafts, spars were all burned, followed by the decking itself in a “perfect rage for demolition”. By the time they reach Queenstown the steamship has been reduced to an iron hull and an engine.

Procurement and supply management professionals on the never-ending hunt for cost savings can face a similar situation. Through the identification of efficiencies, negotiations with suppliers and more drastic cost-cutting initiatives, the wooden decking of the steamship (your organization) can be rapidly stripped away until suddenly you’re left with nothing but the hull.

In an immature procurement function, it’s very easy for procurement professionals to look good by posting impressive savings figures month after month. But as your function matures and savings opportunities become harder to find, your track record suddenly doesn’t look so hot.

Where to from here? Well, that’s where innovative thinking comes in. Finding further savings after all of the obvious avenues have been exhausted takes creativity and out-of-the-box solutions. If you do plan on going back to your supplier base to negotiate lower prices, you’ll need to offer them something in return for a better deal.

Volume, volume, volume

If you’re in a situation where you need further costs savings, but your suppliers genuinely cannot budge on price, there’s one sure-fire lever to reach for – volume.

Most businesses end up paying more than they need to because they only spend a modest amount in a particular category and will never unlock the power of bulk discounts. But not every organization has the resources – or warehouse space – to ramp up their purchase volume on their own. But what if there was a way to get the discounts of “bulk” without having to buy more?

Joining a Group Purchasing Organization (GPO) gives members access to savings you would never be able to negotiate on your own. Your organization joins a group of others buying the same thing, meaning you can leverage your collective purchase and buy in bulk as a group to create buying power.

GPOs help businesses of all sizes save on indirect and direct spend. The savings are found not just through bulk discounts, but through efficiencies (such as cutting down on search time and issuing RFPs) and administrative cost savings.

Collective buying decreases suppliers’ overheads, which drives further savings for the purchasing organization. Imagine, for example, a cashier who takes five minutes to process an order. 1000 single-item orders would require 5000 minutes of labor, whereas a single order of 1000 items requires five minutes of labor.

Looking for some facts and figures?

We get it – you’re a procurement pro, and procurement pros want to see hard numbers rather than fluffy promises of savings. We can’t speak for every GPO out there, but we can prove the value of GPO membership with our own figures.

UNA is a GPO with a combined $100 billion in buying power. We help procurement professionals:

  • Boost their bottom line with deep discounts we negotiate to save an average of 22% on direct and indirect spend.
  • Gain access to steeply discounted agreements (better contracts) that would typically be out of reach.
  • Unlock exclusive savings on products and services including 80% off office supplies, 26% off hotels, 20% off parcel shipping, and more.
  • Save time through pre-negotiated contracts to get started with new suppliers in 30 days or less.
  • Keep prices stable with agreements to ensure rates don’t increase.
  • We provide a free cost analysis across your highest categories of spend and offer procurement tips and support.

OK, but how much does GPO membership cost?

Every GPO is structured differently. Some GPOs charge members a fee for their services, while other GPOs, like UNA, are paid by the suppliers themselves. We, in turn, use that fee to fund our program, so that it’s always free for our members.

Membership with a GPO creates an advantage for the member that they couldn’t get on their own. If you’re running out of cost savings ideas and want to unlock the buying power driven by bulk pricing, a GPO could be the solution needed to keep your steamship sailing along.

Interested in learning more? Contact UNA to discuss the benefits of Group Purchasing.  

The Cabinet of Procurement Curiosities

What’s the weirdest, wackiest item you’ve ever had to source? JAGGAER takes a spooky look into its cabinet of procurement curiosities.

People buy odd things for curious reasons. The same holds true when buying for an organisation – with great purchasing power comes access to some really weird objects.

Procurement Curiosities

We explored our purchasing catalogue to see what we could uncover. Many of these items seem bizarre at first, but they all serve an important purpose for the right person. We bought a few things based on how strange they sounded, only to discover how practical they were.

We’d love to hear about the weird items Procurious readers have purchased or the ones lurking deep within your catalogues. Here’s a sampling of JAGGAER’s collection of curiosities. All of them are real. Some of them are genius.

The Dimensional Lever Punch-Monkey

Sounds like a gag-gift – unless you’re a craft maven or a teacher. The Punch Monkey is actually a tool that punches shapes out of paper – monkey shapes, to be precise. Teachers and crafters use the Punch-Monkey to punch out shapes for projects, borders and other creative pursuits.

Scientific Baby Hippy

We love the mental image this one conjures up – and we have emailed a sketch to the Cartoon Network. But a Baby Hippy is actually a model of a baby’s lower torso, hips and legs that is used to train medical personnel. Ever wonder how paediatric nurses are so good at giving those dreaded vaccinations? Thank the Scientific Baby Hippy.

Rock Crusher

We’re not talking about a monster truck. (Monster trucks are actually one thing we don’t have in our catalog.) But we can hook you up with rock crushers in a variety of sizes. Rock crushers can range in price from $65 to over $30K. They are used – you guessed it – to crush rocks.

Ejector Fork

Sounds like something Elroy Jetson might have used to launch his peas Astro’s way. In real life, an ejector fork has a slightly less exciting existence. It’s a utensil used to transfer and release pipettes containing small volumes of liquid in research labs. If we find a supplier for the Elroy version, you will read it here first. That would be awesome.

Pseudo Drowned Victim Scent

When you need a reliable way to train search dogs, pseudo scent is the way to go. This man-made compound mimics the smell of a human corpse, and maintains its scent for up to 30 minutes in still or running water. But if you spill some on you, and your date likes it, we recommend moving on.

Rat Brain Slicer

Don’t worry: this is not used in the Food and Beverage industry. It’s actually an essential tool for scientists studying the effects of drugs, chemicals and disease on the brain. The brain slicer allows researchers to isolate and prepare sections of rat brain tissue for study.

What procurement curiosities are lurking in your catalogue? Share them in the comments below!

Michelle Douglas is Director of Integrated and Digital Marketing at JAGGAER.com.