Indirect spend gets low priority_2

15 October 2009

16 October 2009 | Steve Bagshaw

Purchasers dealing with indirect categories manage a greater number of suppliers, three times as many stakeholders and face much more maverick spend than those sourcing directs, according to our research.

A survey carried out by SM and procurement outsourcing firm buyingTeam found indirect categories are a low priority in 49 per cent of businesses. Around half of organisations also lack the resource or strategy to source them effectively.

About 250 buyers responded to the Market Intelligence Survey comparing direct and indirect procurement.

The research found that, despite accounting for around a third of spend, indirects on average cover 53 per cent of an organisation's total supply base.

The findings also show that buyers dealing with indirect spend areas typically have more than three times as many internal stakeholders as those dealing with direct categories.

A total of 43 per cent said the volume of stakeholders was the largest challenge they face.

* More details appear in the October 22 issue and the full results will appear in a future issue of SM

 

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