Big businesses make best job of strategic buying

16 October 2002
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17 October 2002

Large firms are putting effective strategic purchasing in place but smaller firms are missing out, according to a new survey.

An Institute of Directors study, Spend Advantage, with Ariba and IBM, shows that 45 per cent of mid-sized firms - with a turnover of £5-50 million - conduct less than 5 per cent of purchasing online.

Less than half worked with suppliers to establish purchasing specifications and processes.

And 33 per cent of small firms - those with sales of up to £5 million - conduct under 5 per cent of buying online. Only 39 per cent co-operate with suppliers.

But of firms with a turnover of £500 million and above, 30 per cent purchased 5-10 per cent of their supplies online, and 78 per cent work with suppliers.

John Watton, Ariba's UK marketing director, said: "Mid-sized businesses are too big for the close relationships with suppliers that small companies can develop and too small to make the significant investment that larger companies can."

• The Spend Advantage survey of 160 business directors can be found at www.spendmanagement.biz/ibm-ariba

SMoct2002

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