How Blockchain can bring greater value (cost reduction/efficiency improvement) to Procure-to-Pay (P2P) providers and their customers

Blockchain is sufficiently complex that many find it a technically challenging idea to grasp.  Here, we’d like to offer a less technically dense explanation of its benefits for P2P providers and their customers.

Much more than a ledger or database, Blockchain is more like a “digital trust”.  It can act as a backbone to one of the most crucial components of doing business – trust.  That trust, with Blockchain, is shared between machines and between humans.

While Blockchain continues in its development as a business tool, business and thought leaders are taking notice and exploring its applications.  One of its most promising applications is in the realm of procurement.

Cutting out the middle man

One of the fundamental features of Blockchain is that it creates the element of trust required to satisfy a transaction.  That means there’s no middle man. Here’s a simple example of a transaction to illustrate the point:

Your friend is travelling overseas and has run out of money.  You get an email asking for a loan. To realize that loan, you transfer money from your own account to your friend’s.

You have trusted a third party to affect the transfer.   Whether you’ve used a bank or a PayPal account, a third party is involved.

You have put your trust in a third party and while we’re all used to doing that as part of a transactional economy, when we do this, we’re exposing ourselves to all manner of things going sideways.  

For example, what if the institution you’re dealing with turns out to be corrupt?  What if the transaction record states that you transferred more money than you asked for?  What if that money ends up in the pocket of the third party?

Blockchain creates the means to cut out the middle man, placing the element of trust in the hands of those who have a personal and direct interest in the transaction.

Security between peers

Without intermediaries in the mix, the element of trust is established between peers in a secure environment.  This streamlines the transactional process, exchanging value directly.

Consider that over 50% of businesses still pay by check, according to a recent study by JP Morgan.  Blockchain’s true potential is in eliminating the need for traditional payment methods, which (while reliable in a sense) slow down the process.

Paper-based transactions are no longer needed, as trust has been established via the security of the system itself, which precludes the possibility of fraud, forgeries and other risks associated with financial transactions.

Increased supply chain transparency

Transparency in the supply chain is a common challenge in procurement.  A lack of it can lead to unpleasant discoveries, hidden behind intermediary entities, including child and slave labor in the production of goods.

Trustworthy traceability ensures due diligence at every link of the supply chain, precluding the need for intensive investigations concerning compliance.  That’s an advantage all procurement professionals will welcome.

CenterPoint Group is a trust procurement advisor.  Contact us to exploit the power of numbers.

The post How Blockchain can bring greater value (cost reduction/efficiency improvement) to Procure-to-Pay (P2P) providers and their customers appeared first on Centerpoint.

source https://centerpointgroup.com/how-blockchain-can-bring-greater-value-cost-reduction-efficiency-improvement-to-procure-to-pay-p2p-providers-and-their-customers/

Is your supplier giving you a good deal? Benchmarking can find out

Most suppliers will claim they’re barely turning a profit on your account. But how can you be sure? The statement isn’t dollar-specific, but it implies you’re getting the supplier’s best number.  It’s vague enough to be more of a fib than a lie!

It’s not all about their numbers, though.  Your numbers matter, too.

How are you benefiting from the vendor relationship? How does your vendor stack up against others?

Benchmarking with CenterPoint Group is the edge you need to ensure that your supplier is on the level with you.  Let’s discuss it and answer the question, “Is your supplier giving you a good deal?” by finding out more about the key metrics benchmarking can provide.

Metrics

Procurement benchmarking depends on 5 foundational references:

• What percentage of total spend is operating expenses?
• What percentage of total spend are savings?
• How much does it cost to process a Purchase Order?
• Which suppliers are receiving the lion’s share of your budget?
• How much of your total spend does procurement control or manage?

There are many other factors involved in determining whether your supplier is doing you any favors, but this is a good start and a firm foundation for benchmarking.

For the purposes of this post, we’ll focus on reference 4, which is the metric most relevant in terms of your supplier relationships, their transparency and the mutual benefit they’re capable of producing.

The top 6%

Almost globally, companies do the bulk of their business in the supply chain with 6% of their active vendors.  These are the outfits who receive 80% of the company budget in their class of supply or service.

You’re given a sterling opportunity to cement mutually beneficial relationships with this top tier of suppliers.  Cemented by loyalty and shared interest, the top 6% is your ticket to a solid and sustainable supply chain that serves vendors, buyers and everyone else involved.

Relationships are what the world is built on.  Good relationships are well worth cultivating, when it comes to your top 6%, because they serve the greater good and certainly, your bottom line.

Because when your supplier relationships are strong, you’re never going to have to wonder if your supplier is bending the truth.  Good relationships are supported by honesty and transparency, which add up to total integrity.

CenterPoint Group

At CenterPoint, we’re a data-driven procurement advisor.  With the power of numbers, we bring you superior customer support which does the benchmarking for you.  You’ll always know where you stand in your vendor relationships with CenterPoint, because precision benchmarking answers the question for you.

With sophisticated auditing, benchmarking and analysis, CenterPoint is technologically able to provide you with the detailed vendor monitoring you need to know you’re getting the best deal possible.

Getting a handle on your vendor relationships is the first step toward getting the best possible deal.  With CenterPoint, that’s already done.  We get to the heart of the matter by deploying laser sharp data analysis that gets you there.  Contact us.

The post Is your supplier giving you a good deal? Benchmarking can find out appeared first on Centerpoint.

source http://centerpointgroup.com/supplier-giving-good-deal-benchmarking-can-find/

Supply chain RFPs consume significant time and resources. We have the solution

The Request for Proposal process has many challenges.  You’re looking for the best deal and multiple vendors are looking to become your “go to” source for the goods or services you’re reaching out to procure.

But supply chain RFPs consume significant time and resources and they often don’t get done what you anticipate they will, regardless of how carefully you produce them.

But your perceptions and those of potential vendors are going to be different.  Vendors who don’t make the winning bid generally follow up with a request for debriefing about why they fell short.  But sometimes, people responsible for RFPs are left scratching their heads when their efforts don’t produce the desired results.

Clarity and transparency

Far too often, RFPs are released into the market without a clear description of the scope of work required.  When this is the case, there are sometimes tremendous disparities between bids that reveal the flaw.

If an RFP goes out which receives bids which vary wildly, what could possibly have gone wrong?

That would be your description of what’s required.  It could also be that you haven’t been transparent about your budget.  Fine, clear descriptions and budgetary transparency render more realistic bids.

These two factors can prevent a lot of misunderstandings and vendors wasting their time on bids that go straight to File 13.  With greater clarity and transparency, their resources can be spared.  That helps you build relationships with vendors you may need later.

Let’s face it – when organizations are spending between numerous hours preparing a bid and a bunch of money on human resources, you’re not going to be the most popular company on the block.  The time and resources consumed might have been spared, had you had your RFP ducks in a row.

CenterPoint Group has the solution

CenterPoint is a trusted procurement advisor with a membership adding their resources to our expertise to create the conditions needed for exceptional procurement management.

Part of the service we offer our members is an in-depth RFP process which gets the job done, sparing you damaged public profile due to RFPs that waste the resources of your bidders.

Because we leverage indirect collective spend of $850 million, we get the best deals from the best vendors in the industry, using the buying power of our members.

That positions your firm to benefit from high-level expertise that gets you realistic, quality bids which help build relationships down the supply chain.

CenterPoint Group manages your member account with exceptional customer service, ongoing reporting and key data analysis that monitors the status of the market and your agreements with vendors.  You get the best deal, plus the administrative and analytical experience of a longstanding procurement partner, as a member.

Supply chain RFPs consume significant time and resources, but CenterPoint Group has the solution.  Marrying your buying power to that of other members and uniting that enhanced market presence with CenterPoint’s expertise is that solution.

Contact us to find out more about our leading-edge procurement solutions.

The post Supply chain RFPs consume significant time and resources. We have the solution appeared first on Centerpoint.

source http://centerpointgroup.com/supply-chain-rfps-consume-significant-time-resources-solution/

How to Avoid Price Increases

US Paper Mills increase prices twice in a 3-month period leading to rising costs for business, CenterPoint’s members are protected

 In recent months, US paper mills have raised their prices by 30%, causing businesses who depend on their products to feel a significant pinch.

This has occurred due to an increase in the prices of pulp and the chemicals used to treat it in the paper production process.  Of course, the cost is being handed down to business consumers.  That’s usually the case.

Businesses have always expected to pay more due to the high demand over the winter months, as more paper is sold in the form of notebooks and books.  But this year, it’s the cost of materials used in production (including imported coal from India) prompting sizable increases across the board for paper products.

What’s the solution?

What are businesses to do about these unforeseen price increases?  They still need that paper.  But how do they mitigate the damage?

CenterPoint Group is a trusted procurement advisor, bringing businesses of all sizes the solution they’re seeking to problems like the one described above.  Because we leverage $850 million in collective, indirect spend, you get the power of numbers behind your operation, keeping your costs low.

We also give our clients the gift of cost certainty, as our prices are not governed by producers, but by best-in-class pricing for over 1,500 products.

The CenterPoint advantage

Our member-driven procurement process saves our members money.  Price increases rarely happen with CenterPoint, giving you the ability to budget with certainty.

But we don’t stop at merely procuring for your needs.  We sustain and manage your account, ensuring that you’re being charged correctly.  With data analysis and ongoing reporting, you’re assured of getting the best deal with us.

No more of your valuable human resources will be continually drawn into lengthy and often futile RFP efforts.  We do that for you.

On top of it

We stay on top of market trends to help better manage your office supply contract.  Again, that means your human resources can be deployed more effectively, as we provide focused analysis to stay on top of pricing and market impulses which are meaningful to your bottom line.

To all this add exemplary customer service, so you always know what’s going on with your account.  The pricing volatility of the paper market is no match for CenterPoint Group.  Our proprietary and innovative analytics keep you well ahead of the curve.

Unforeseen pricing increases like those occasioned by US paper mills can destabilize your company at the budgetary level.  By leveraging the power of numbers with CenterPoint Group, you avoid this effect.

With CenterPoint on your side, you get the power of numbers, joining with other members to optimize your office supply spend.

If you’ve had enough of being buffeted by the uncertainty of the paper market, it’s time to join CenterPoint Group.  Get the certainty and buying power that’s only possible when people get together.

Contact us to get the power of numbers.  Show US paper producers who’s boss.

The post How to Avoid Price Increases appeared first on Centerpoint.

source http://centerpointgroup.com/avoid-price-increases/