LONDON–(BUSINESS WIRE)–SpendEdge, a leading provider of procurement market intelligence solutions, has announced the completion of their latest article on challenges for strategic sourcing – what’s bothering supply chain executives.
Organizations often associate the sourcing process with purchasing at the lowest cost. However, it has evolved with the passage of time. It eliminates sourcing based on unjustified preferences and helps organizations gain the best long-term value. It also emphasizes the entire life-cycle of products rather than simply concerning the price of purchasing. Moreover, in the strategic sourcing process decisions are based on facts, analysis, and market intelligence to bring about savings.
At SpendEdge, we understand that supply chain executives have to make decisions on collaborative designing, fixing the requirement specification, and switching to new suppliers. And to help you understand better, we have highlighted the top challenges for strategic sourcing.
Challenges for Strategic Sourcing
Total cost of ownership vs. invoice price
CPOs often make sourcing decisions based on invoices prices. But when different variables such as freight cost, inventory cost, installation cost, maintenance cost, MOQ’s, trade barriers, duties come into play, they start facing predicaments in calculating the total cost of ownership.
Calculating the total cost of ownership can be an arduous task due to the numerous variables involved in it. Book a free demo to access our smart procurement solutions.
Off-shore vs. near shore
Sourcing in bigger companies has gotten complex over time. They vary as per geographic region. Near shoring reduces lead time and minimizes transportation costs but it is not possible with off-shoring. Companies have to face fewer cultural and language barriers. To know more about near shoring and offshoring processes, get in touch with our experts now!
Supplier base rationalization
Rationalizing supplier base is imperative for companies to manage relationships effectively. This requires companies to analyze the current profile of vendors, find redundancy, check prices, lead time, and quality. They also need to identify if multiple vendors are producing the same parts simultaneously. This does not mean reducing the supplier base to an alarmingly low level.
To know more about the challenges of strategic sourcing, read the complete article here!
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SpendEdge shares your passion for driving sourcing and procurement excellence. We are the preferred procurement market intelligence partner for 120+ Fortune 500 firms and other leading companies across numerous industries. Our strength lies in delivering robust, real-time procurement market intelligence reports and solutions.
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