Preparing your procurement team for success.

At Tradeling we are obsessed with the success of our customers. In a competitive market, and a complex world, SMEs face an array of challenges and conflicting demands. Our mission is to create a digital ecosystem that helps tame that complexity and cut through the clutter of business buying with an easy-to-use marketplace and associated logistics and financial features. The future of trade is digital and we’re building that future now.We are now adding educational resources to this digital ecosystem to help our customers understand and master every aspect of business-to-business (B2B) trade. One of the first pieces we’ve produced is a set of best practices for procurement success. Read it in full at:?https://blog.tradeling.com/en/myb2b/procurement-best-practices.

Allow me to preview our findings and offer some additional thoughts.Of course, each business is unique, but these guidelines should have general application. What we’ve found in our research and in conversations with customers, is that many businesses could improve the integration of their procurement or sourcing function with other parts of their organisation. Several of the best practices we recommend are intended to remedy this.Our 7 recommendations for procurement success are:

1. Putting a Procurement Management Framework in place.
2. Automation of manual tasks.
3. Creating a centralised hub for documents and contracts.
4. Optimising inventory management.
5. Improving Supplier Relationship Management.
6. Integrating and simplifying processes.
7. Thinking beyond cost reduction

Let’s explore three of these in more detail.

Leadership is critical to every aspect of business, no less so for procurement. Developing a Procurement Management Framework enables better oversight and sets clear expectations for all stakeholders. Make it clear to your procurement team, other business units and external suppliers what their duties are and how these interlink with other stakeholders’ duties. I find that such a framework allows your team to know what success will look like and empowers them to strive for excellence. In the absence of such a framework, poor coordination and silos are likely. Once you create an environment that encourages every stakeholder to take ownership, your team will consistently meet and exceed every target they set. In my view, true leadership is not top-down, instead it radiates outward from every individual, irrespective of their job title.

The second key to procurement success, that I’d like to highlight, is optimising your inventory management. One of the trickiest aspects of running a business is balancing the operational need to keep sufficient inventory in reserve, versus the financial need to reduce the amount of capital locked away in unused inventory. This challenge becomes more acute when exchange rates and other economic factors fluctuate over the lifespan of your inventory. As the past two years have demonstrated, supply chain disruptions can combine with the above factors to make inventory management a high-stakes endeavour. At Tradeling we have developed a number of solutions to help our customers face and overcome these challenges.

Some of these solutions are focused on agility: our digital marketplace has more than a million products from over 55 countries, allowing our buyers to rapidly find and compare alternative products and suppliers. We’ve also launched an RFQ marketplace where buyers can submit specific requests for products and quickly garner quotations from multiple suppliers. In addition, we’ve created solutions aimed at improved efficiency, for instance, we offer international suppliers an inventory solution through our Fulfilled by Tradeling service: it allows them to ship stock in bulk to the UAE, where we receive it in our warehouses, manage the inventory, provide last-mile delivery, handle returns and provide world class customer support.

Finally, I’d like to briefly reflect on the importance of a “partnership”-mindset. Supplier Relationship Management has become an integral part of procurement success. I believe that the Covid pandemic unambiguously showed the value of good supplier relationships. Many suppliers and buyers overcame significant challenges because they viewed each other as partners. At Tradeling we have built our digital ecosystem with the explicit goal of matching buyers and suppliers and fostering mutually beneficial partnerships. It starts with verifying buyers and suppliers to create a high degree of trust.

In addition, we provide tools for buyers and suppliers to negotiate, track orders and access credit, all in one place. We also prompt our buyers and sellers to attend to communication from their trading partners.I’ll leave you with this thought-provoking fact: in 2019 UNICEF saved over US$ 360 million in their procurement process, exceeding their savings target by 25%. Imagine what an equivalent improvement in procurement would do for your business!