Catching up with VORTAL – growth, expansion and developments

Supplier compliance

Since we last caught up with integrated supplier marketplace and source-to-pay solution provider VORTAL, back in 2014, the landscape has been changing for this 20-year-old, Portugal-born and -bred provider. A cloud-based collaborative marketplace comprising a supplier network and discovery technology, along with full eSourcing capability, it has grown to accommodate 10,000 private and public sector buying organisations, with transactions from over 300,000 customers. While initially based in Portugal, VORTAL’s presence has become global, spreading within Europe to Spain, Germany, France, Italy, and Slovenia, and beyond to Mexico, Colombia, Peru, Honduras, and the Dominican Republic.

VORTAL’s origins lay in the private sector where it focused on the project-based industries of engineering and construction. The EU Public Procurement Directives delivered a great opportunity for the firm, which saw a period of rapid expansion in the European public sector, leading to a worldwide public sector focus.

Private sector growth

Nowadays VORTAL is expanding its presence in the private sector, and those operations are tipping the private vs public presence balance. In fact the firm has been reinforcing its private-sector capability over the past two years, hiring more consultants and procurement experts, reinforcing worldwide implementation capabilities, and bringing in strategic consultancy experts to support category management and change management projects. It is also expanding its considerable partnership network.

The firm now operates with 200 staff, covering multiple languages and time-zones, and is investing heavily in R&D. Despite being known to service the mid-sector of the market, recent implementations have been for larger, multi-site firms like Domino’s Pizza and Burger King, so the large corporations are starting to look towards VORTAL.

We asked VORTAL what has effected this change.

CEO Miguel Sobral explained: “Strategic sourcing platforms work well for the ‘first tier’ of spend – where a limited number of large contracts are negotiated with a pre-qualified number of suppliers. As for the ‘third tier,’ or catalogue-driven procurement, this has been covered by platforms like Amazon Business and Alibaba, which have been growing significantly in this area and doing a great job, in fact they represent an important new way of sourcing. But between the first and the third tiers, there is a window of spend - ‘the second tier’ - which sits below strategic spending and above catalogue buying. This tier-two spending is not as well served and as widely spread across organisations, typically being carried out by multiple decentralised buying teams.

The main reason why indirect spend, and what we call ‘middle spend,’ is not usually addressed using strategic sourcing platforms is because suppliers are not willing to register on multiple platforms to submit proposals to various customers. So at VORTAL we are implementing new ways of running that process, responding to customers who tell us it’s just as important for them to use technology for indirect spend as it is for strategic.”

The platform

The VORTAL platform combines benefits for both buyside and supplyside, so that buyers of all sizes, including complex sourcing organisations through to the smaller departments, can use the technology to perform sourcing operations, from a simple RFP through to managing contracts, sourcing from the 300,000 suppliers making use of the collaborative network. “The growing network researches suppliers, captures their information, and nurtures them, so that proposals from even the smallest suppliers do not go through the typical email route, but through the system. This is the type of business that is well supported for our buyers on the platform,” explained Miguel.

“The platform is ideal for companies with a high level of maintenance or services needs in multiple geographies, perhaps on various construction sites in different places, or retailers opening new outlets internationally, or new restaurants launching in different geographies. Their need is to negotiate very large contracts, on multiple tiers, perform a large number of RFPs and run complex contracts with multiple suppliers in multiple regions, all of this takes a lot of time and effort. This is where VORTAL can really support them, by helping them to discover suppliers that are best suited to their needs in the right locations.”

What appears to be the driver of supplier variation and quantity, is the significant presence the firm has within the public sector. Taking advantage of this strength, VORTAL is able to attract a large number of suppliers into its ecosystem. And this organically grown collaborative supplier network also benefits from a team of people complementing the system by scouting, researching and nurturing new suppliers into the community, using native languages of English, German, Italian, Spanish and Portuguese.

“What our customers really value,” Miguel tells us, “is having access to a single, large, global community of suppliers, across multiple spend categories, in multiple countries that is regularly refreshed, alongside the ability to run auctions, manage contracts, and basically perform all sourcing activities, and have the possibility to perform supplier qualification and evaluation accordingly with their internal processes.”

The firm has been developing the solution over the past 12 months, and in October launched an updated version of the platform with new interfaces. The goal, Miguel informs us, is to further increase usability and adoption, because “simplicity is our strategic weapon.”

Simplicity, usability and intelligence

The big focus for VORTAL is to make the sourcing functionality easy to use, yet complex enough to cater for the larger buying organisations and configurable enough so that even small procurement teams can use it, but still with access to the wide range of prequalified suppliers and spend categories. It’s worth noting that because of the relationship with the public sector, these suppliers can even include those of medical or military equipment. Suppliers are attracted to the platform because they not only gain visibility to buyers, but have access to valuable knowledge, like market trends in spend categories across regions through regional sources and open data. In fact the partner network has been growing significantly, and as market data grows, so more is analysed and made available to the buyside.

It is the simplicity of the system that we understand is most attractive, while managing the entire procurement process, saving time on everyday tasks.

Magnus Bergfors, our VP European Research and Lead Analyst, recently completed a demo of the software, and had this to say:

”VORTAL is one of the most well kept secrets in the S2P space. They are more known in the public sector, were they are one of the strongest vendors, but actually its origin is in the private sector and should be included in any S2P evaluation, especially in Europe and Latin America.”

 

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