Spend Matters’ Pierre Mitchell and MetalMiner’s Lisa Reisman offer their perspectives on how a supplier’s cost structure has changed over the past decade. From regulatory impacts to labor productivity gains and volatile commodity environments, these shifts have dramatically impacted the notion of the “supplier’s cost structure.” Learn how these 2 experts consider several factors and chime in with your own questions to take the discussion further.
Category Archives: Suppliers
Greece’s trade partners are no doubt worrying what the country’s debt crisis will mean for them in the coming days, weeks and beyond. Imports and exports in and out of Greece will likely be impacted immediately this week (if not already) and those that do business with Greek companies may have to look elsewhere for supplies and for selling their goods. The Spend Matters Network analyst team has offered their expert opinions on what this situation means for procurement. How will suppliers working with the Greece government get paid? Will they get paid? And what happens if Greece exits the Euro? Our experts weigh in on these procurement questions.
I learned a surprising and fairly upsetting lesson about sourcing this week. Call me naive – I am still a rookie in the procurement world, after all. But, what I learned is that companies knowingly work with suppliers that provide defective products and services. Or at least one company does: Visionworks. I bought a pair of glasses from the company last spring, and since then I have had the lenses replaced when the anti-scratch coating began chipping off. However, the coating is again flaking off my "replacement" lenses, and Visionworks says I am out of luck, despite admitting their suppliers sometimes create batches of scratch coatings that are "defective."
US-based supplier diversity programs often represent one of the true success stories of niche-based initiatives that can have real impact with limited budget and resources. Most programs at larger companies still only have a single or handful of dedicated resources and budgets – at best – for supporting technology and data enrichment to manage and track supplier credentials, and reporting pales in comparison to other procurement solution areas. Yet the quantification of program results, including those in which diversity improvement is mandatory in government supply chains, often speaks for itself. Might early payment programs, either by requirement or encouragement, be the next logical step to link to supplier diversity efforts?
In a recent study conducted by Spend Matters and the Institute for Supply Management that explored the state of services procurement technology adoption and best practices focused on contingent labor, we found that less that 50% of respondents were either using a specially designed solution from their MSP or a best-of-breed vendor management system (VMS) to manage contingent labor spending. The largest percentage of respondents are “kludging” an approach with ERP or e-procurement technology. This begs the question: Why? We search for an answer.
When it comes to encouraging the use of e-invoicing, payment or trade financing standards and expectations, government moral suasion is terribly ineffective compared with government regulation and policy. Consider the case of the White House-led SupplierPay initiative compared with regional initiatives centered on e-invoicing adoption in Latin America. My colleague David Gustin recently opined on the topic on Trade Financing Matters – read on to hear what he had to say about it, specifically how the program lacks real teeth.
While it may be common practice for large buyers to shift risk to their suppliers, this is not ideal in achieving the desired cost-effective outcome. For this webinar, Spend Matters will join forces with IACCM and Seal Software to analyze the contract terms Apple has with its suppliers. This analysis will discuss how “risk shifting” across several suppliers can impact total cost and also how to reduce risk-treatment costs. Understanding Risk Exposure: An Analysis of Apple’s Contract Terms For Their Suppliers is scheduled for Thursday, June 25 at 10 a.m. CDT. Register today!
VMSA Live 2015 Pulls Up Stakes in Vegas, Contingent Workforce Suppliers Brace For Demanding Supply Chain Environment
Bucking up the supplier side was a clear focus on the final half-day of VMSA Live last week. The 2 and a half day conference is designed to bring together practioners from all parts of the staffing supply chain (including enterprise contingent workforce programs, MSPs, VMSs, staffing suppliers of various kinds, and other supporting service and solution provides). While the prior 2 days of the conference modulated actual interaction and information exchange between the supplier and the enterprise sides of the staffing supply chain, Friday’s sessions aimed to provide undivided attention and a “thumbs-up” to the upstream businesses that do the bulk of the work to supply enterprises with their contingent workforce (temps and contractors) and talent-based project services (SOWs).
McDonald’s recently announced an important commitment to sustainability by moving to eliminate suppliers that engage in any potential deforestation practices in its supply chain. For quick background reading on the topic, see McDonald’s Corporation Commitment on Deforestation pledge. On the surface, the pronouncement would seem to have corporate social responsibility teeth. I share some of the main points the fast food company has made in its new commitment.
There has been a huge amount of hype for the new Apple Watch – with some 1 in 4 people eyeing the flashy device. Yet already Apple has run into a snag in its supply chain with the rollout of its latest product: a critical part from one of its suppliers was “found to be defective.” Specifically, some “taptic” engines (which have ability to deliver tactile feedback) produced for the watches by AAC Technologies Holdings Inc. are breaking, forcing Apple to trash the watches with the faulty parts. While it doesn’t seem that Apple has sold any of the defective watches to customers and doesn’t have to deal with a product recall, it still will slow production of the in-demand device, causing an even bigger headache for the tech giant already suffering from supply and demand issues with the watch. Thomas Kase, Spend Matters vice president of research, shared his thoughts on the news, calling the dilemma “cultural issues at work.”
Intesource’s New Supplier Relationship Management Solution: Why it Should Be on Your Short List of Vendor Considerations
This is Part 2 of our in-depth look at Intesource and it new SRM solution release. You can check out Part 1 here. So what is the new supplier relationship management solution like? Gabe Gabaldon, Intesource's CTO, shared some details around the latest update to its sourcing solution. In this PRO research brief, I provide some of the highlights Gabe pointed out, such as its emphasis on enterprise-wide rollout, enhanced customer support and cleaner supplier data. I also offer my input on the solution and add key takeaways.
In between presenting this morning at Tungsten Insights 2015, and facilitating a panel discussion later today with suppliers on supplier networks and e-procurement solutions (or marketplaces), I sat in for a breakout session led by Selina Yankson, head of campaign management for Tungsten. Selina shared a number of items in her “secret sauce” to maximizing supplier enrollment. She also talked about new approaches Tungsten is taking, as well as enrollment components of Tungsten’s next generation supplier portal. We’ll leave the details of the portal for future analysis as well as some of the key lessons learned over the years in scaling global programs. But here are a few of Selina’s quick tips that jumped out from her talk.