Analyze your current procurement process within your company to help identify new opportunities. The goal being that once implemented they will benefit your company through lower operational costs.
Are you dealing with one-sided partnerships?
In today’s business environment many of the partnerships in place are one-sided. These kinds of arrangements do not get effective long-term results. Many suppliers are bullied into participating in such programs. Our consultants will help you to develop and implement a program that suppliers will want to participate in.
Suppliers want to contribute to long-term cost savings
These programs are firm but fair, expectations and rewards are clearly defined. A measurement and rating system is designed specifically to meet your needs. Your suppliers’ future volume will be based on their ability to meet expectations and contribute to cost savings. Your supplier selection and audit process is a critical part of insuring you have the right suppliers in your program.
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Are your suppliers performing up to expectation?
- Is there a high number of late deliveries?
- Do you have Quality problems on buy items?
- Is there poor communication with the suppliers?
- Are you carrying excess inventory to hide problems with deliveries?
- Are there too many suppliers to manage?
- Have costs continued to increase?
- Is purchasing spending too much time expediting?
The first step involves analyzing your current supplier base and your relationship with it. Measurement, corrective action, quality requirements and audit data if available are all reviewed.
The manual is the “rule book” for the program. It clearly defines the advantages of participation and disadvantages for lack of performance. Levels are assigned based on participation and the rewards increase based on performance. Performance in the areas of on-time delivery, quality and cost reduction efforts are all measured.
Selection & Audit Process
The process for select suppliers is developed and documented. Once completed current suppliers will re-apply for becoming a supplier. A formal audit process for accepted suppliers is documented. The process expands well beyond quality requirements into full operational audits.
In order to roll out the program suppliers are invited to supplier day events. During this time they are made aware of the program and how they can take advantage of the program for mutual benefit.
Leverage partnership to lower cost
Once implemented you will be able to use the program to lower cost. You will have a stronger supplier base that is willing to work with you to lower cost.