Suppliers come up with more money saving ideas

28 March 2013

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28 March 2013 | Adam Leach

Suppliers are coming up with more ideas on how to save money for buyers than they were two years ago, according to the latest SM100 poll.

Prompted by the announcement in the UK budget that more money would be assigned to support new ideas from suppliers to the public sector, the panel of 100 purchasers were asked: “Do you get a greater number of money-saving ideas than you did two years ago?”. A slight majority of 52 per cent said they were receiving more ideas, with 48 per cent saying that the frequency had not increased.

Bill Fyfe, head of procurement at National Trust for Scotland, has seen suppliers raise the number of ideas they are providing. “With less contracts being issued, suppliers are looking at ways of holding on to the ones they have,” he told SM, adding that in some cases these ideas had directly led to cashable savings. “One example was by combining delivery of our stationery, signage and retail goods to properties we saved in excess of £50,000 and also reduced our carbon footprint.”

Nic Porter, managing director at Procuring Online, agreed the increase in ideas was borne from suppliers feeling more under pressure to satisfy customers. “I think there is a realisation from vendors that, increasingly, companies are looking to remove cost from their third-party expenditure.”

Porter is working to capitalise on the heightened willingness to innovate: “We developed an innovation forum for vendors from different categories to work together to share ideas and to generate innovative cost reduction ideas through reviewing the services supplied from a different perspective.

Lesley Mason, head of procurement operations at Orbit Group, had not identified a marked difference in the number of ideas offered. But she told SM she was more focused on delivered improvements than new ideas. “We don’t have a formal process for submitting ideas, and if a contract is working well, it shouldn’t need one. More useful would be a mechanism to capture improvements that have happened.”

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