There’s no doubt about it, negotiating a bargain-basement price gives every buyer a bit of a buzz. But once the excitement of cost cutting dissipates, will your new supplier be able to live up to expectations in other areas?
It’s with high hopes that we begin each sourcing journey: we’re envisaging a new partner who’ll deliver on qualitative factors as well as providing the right bottom-line figure. We’re asking for reliability, quality, exceptional service and a host of other business-specific concerns, and all the while expecting to come in on budget.
We’re right in seeking value for money, but should price be the overriding concern? Wouldn’t we be doing our businesses a disservice if we were to allow cost considerations to supersede all others?
Yes. As recognised by Spend Matters last week, this price-only approach leaves you open to risks:
‘If price and possibly some subjective public perception are the only deciding factors, the buyers subject their company to a variety of risks (buying the incorrect type of product or service, poor quality, poor customer service, excessive costs of logistics, etc.) and likely forego supplier relationships that bring significant added value.’
It’s vital that a buyer thinks carefully about the range of qualities required in a new supply partner, and communicates these clearly, carefully specifying their needs and what they’re expecting a new partner to bring to a relationship.
e-Sourcing makes this stage straightforward by allowing you to frame your requirements in one of four ways, through an e-Request for Quotation, e-Request for Tender, e-Request for Information or e-Request for Proposal (read more about each type here). By adding questions and items to your e-Request, you can go into great detail and ensure you receive relevant responses.
And once it comes to the evaluation process, SourceDogg’s e-sourcing platform makes life easier still by allowing multiple employees to score each submission on its individual merits, with every scoring area being weighted to correspond to how valuable such an aspect is to your business.
As soon as the scoring process is complete, you’ll be able to consult the leaderboard and welcome your new supplier – the top scorer and therefore the partner offering a solution to best meet your needs. And as buyer and supplier, you’ll live happily every after!