Becoming Best in Class

Understand your Suppliers

In order to successfully negotiate favourable agreements with your suppliers, it’s imperative to understand how suppliers can glean profit within their contracts.

Whether you are considering negotiations with an incumbent supplier or kick starting the bidding process, review your organisation’s current needs and what products and services will be necessary to keep your organisation running smoothly.

It is also important to rely on industry bench marking to ensure that the offer you’re receiving from a supplier is competitive. You can develop industry-specific benchmarks as well as per capita benchmarks to ensure that you are getting the best pricing as compared with your peers as well as compared to other industries.

By keeping your organisation’s must-have requirements top of mind, you’ll be able to articulate this during the negotiation process better. Providing suppliers with greater context can reduce their risk and potentially secure you with improved services (compared to their standard offer).

Click here to download our Becoming Best in Class white paper.

Develop Systems to Prevent Price Increases Over Time

One of the most critical aspects of streamlining contracts is to designate one centralised department or facility staff member to maintain current contracts and check supplier invoices for errors, new fees or additional charges. This individual should also keep track of when contracts are set to expire so that they do not automatically renew at a higher rate and to give staff enough time to renegotiate a new contract or start the bidding process, if necessary.

Establish Methods to Monitor and Maintain Savings

It is essential to develop key performance indicators (KPIs) and monitor them throughout the contract’s term to continuously maximise savings over time. By establishing KPIs based on the cost-drivers of a particular service or supplier, your organisation can track the trends and changes to determine the impact it will have on your organisation’s bottom line.

Take action now – download the full white paper for free and gain a competitive advantage.