7 Reasons You Need Procurement Consulting

To cut costs and increase profits, many businesses try to reduce their overhead by doing everything in-house. However, sometimes that strategy ends up costing you more in the long run—both in time and money. If you’re not sure about which route to take, here are seven reasons why you need procurement consulting services to help your business succeed.


1) Understand your legal obligations

The laws that govern procurement vary by industry, by country, and even sometimes within countries. It’s important to understand your legal obligations before getting started. Unfortunately, purchasing can easily turn into a game of let’s see who can write up their obligations in the most confusing way possible. By engaging procurement consulting services early on, you can take advantage of the expertise that can help guide you through legal minefields so they don’t derail your process. Procurement consulting services will also help ensure all parties are aware of their respective responsibilities.

2) Evaluate suppliers

One of your most important responsibilities is keeping tabs on vendor performance. Not only do you want to ensure that suppliers are delivering quality products on time, but also, you need to ensure they aren’t taking advantage of your company in any way. By using procurement consulting services, you can quickly evaluate new vendors before committing to long-term relationships. It might seem like a lot of work upfront, but it could save your company thousands in future losses.

3) Manage project risks

Companies of all shapes and sizes need to ensure their procurement projects are successful. If you don’t manage risks, you could lose money, your reputation or both. It’s important to remember that we can’t solve risk—we can only manage it. By identifying risk factors before they become issues, global sourcing companies will be able to manage them effectively and avoid potentially costly mistakes down the road. A good first step is to build an exhaustive list of all possible threats—including threats that may not seem important right now but might change in value later on.

4) Achieve compliance with legislation

Whether you’re just starting out or have been in business for years, one of your top concerns is likely reducing your supply chain costs. Few things can cost a company more than not having its suppliers under control and operating at optimal levels. With over three decades of experience and hundreds of millions of dollars saved on our client’s behalf, we know how to help you save money without sacrificing quality or increasing risk. If you need help with sourcing strategies, supplier relations management, compliance management, and more, a good procurement firm would be glad to get started with a free consultation!

5) Reduce supply chain costs

By reducing the costs of materials through more efficient supply chain practices, organizations can reduce their overhead and bottom line. A study by KPMG showed that companies that implemented supply chain management programs saved an average of 16% on procurement spending over three years. That’s not only great for your profits but also for your customers; if you can save money by purchasing materials more efficiently, you can pass some or all of those savings along to them.

6) Create value from procurement services

As your business scales, it becomes more and more important to have a team of professionals who can help you procure services you need at a price that makes sense. These are people with expertise in management consulting, data analytics, outsourcing, supply chain management, sourcing—the list goes on. They may not be household names yet, but they are quickly becoming an integral part of doing business. If you’re looking for your next big acquisition or just want to create more value from your existing suppliers, these procurement consulting firms are here to help.

7) Develop strategic sourcing capabilities

Strategic sourcing is a type of procurement in which organizations take advantage of economies of scale and negotiate contracts with suppliers in order to achieve better pricing. Strategic sourcing has become increasingly important for today’s businesses, as consumers expect them to offer competitive pricing while still maintaining profitability. If you want to be able to source goods efficiently and ensure you are paying fair prices, professional consulting can help you build strategic sourcing capabilities.

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