The future of procurement lies in bridging the gap between the function and sales, buyers have been told.
Hemant Gupta, CFO and head of procurement at Indian apparel brand Blackberrys, said bringing the two functions together would help manage working capital, improve procurement’s ability to serve its end-users and add value in areas not directly related to procurement, including logistics and warehousing.
Speaking at the Ivalua Now conference in London on Tuesday, Gupta said: “The future of procurement lies in bridging the gap between the sales function and the procurement function.
“That is going to add on value against other administrative costs that are not directly related to procurement like warehousing costs, logistics costs. If you’re able to bridge the gap between the sales and the procurement function and able to make it much closer, it is going to help us manage the working capital much better, and secondly to serve my end customer better.”
Gupta said bridging this gap was about making both stakeholders and suppliers “collaborative partners”. He said the firm was working with vendors to ensure they are able to deliver ahead of schedule and was penalising suppliers that delivered late, because late deliveries impacted on end-sales and sell-through rates.
“They [suppliers] are acting more as a channel partner than just suppliers that give us the timely procurement and the cost efficiency,” he said.
Speaking during a panel discussion of the future of procurement, Krista Konstenius, CPO of cargo handling firm Cargotech, echoed the need for collaboration. “I think the future is collaboration. We need to ensure that we are really collaborating with the suppliers and collaborating with the business and not working only in on silo,” she said.
Konstenius added it was important for procurement to align itself with the priorities of the business, which she described as “must-win battles”.
“We are aligning our operations to agree what are the procurement must-win battles that we can contribute to the overall Cargotech must-win battles,” she said.
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