- Evaluate current practices and identify areas that can be improved.
- Formalize a procurement policy that spells out who is authorized to buy what and from whom.
- Work with preferred suppliers who can fulfill many of your procurement needs and offer better pricing for bulk purchasing.
Action Steps
The best contacts and resources to help you get it done
Define priorities
Look at where you are spending the most money and which suppliers are getting the highest percentage of your spend. Streamline processes, examine how orders are placed or what controls need to be revamped.I recommend: Entrepreneur.com has suggestions for creating a purchasing strategy. Organizations like AMR Research and Aberdeen Group provide case studies detailing successful strategies.
Hone your skills
While small business owners typically wear many hats, perfecting purchasing practices means bolstering organizational, business analysis, negotiation and a host of other skills.I recommend: The Institute of Supply Management (ISM) offers courses, Web seminars and other resources for brushing up purchasing and supply chain management skills. Keep up with new trends through Purchasing Magazine.
Think about adding staff
If you don't have enough time to take on the work that comes with implementing a procurement strategy properly, it may be time to boost your head count and hire folks who can manage this portion of the business.I recommend: Professional organizations, like the American Purchasing Society, and job-listing boards, such as Buyingjobs.com and TopUSAjobs.com, help match potential employers and employees.
Automate your purchasing practices
Technology and the Web now make it easier to roll up these activities, track spending and manage suppliers.I recommend: Companies like Ariba and Verticalnet offer various kinds of software solutions while Aslins offers a partial listing of purchasing portals and online auction sites.
Tips & Tactics
Helpful advice for making the most of this Guide
- Benchmark progress. Set deadlines for reaching certain goals, and as those deadlines approach, look at what the impact has been on your business. How much money or time have you saved? How are your suppliers meeting customer service level agreements? Where improvements are still needed?
- Monitor the market. Some industries are more susceptible to changes in the broader markets, so it's a good idea to stay on top of changing business conditions. for example, follow current supply and demand trends.
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