If you purchase, sooner or later, you will get a bill which must be paid. This is something that every business must do. At LPS, our core business is placing orders for our clients. We are constantly focused on reducing our costs through process efficiency. In this installment, we will be analyzing how we have optimized the purchasing process with the goal of lowering cost and increasing accuracy.Read More
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-Cost savings with measurement of services levels and defined baseline costs.
-Increasing company productivity by reassigning key personnel from procurement o impact activities.
-Factual research and results referenced in the following article.
-An offer from LPS to review feasibility at no initial cost – we take the investigative risk for you!
-What is vendor consolidation and why is it considered beneficial?
-What are the key benefits of vendor consolidation?-How much would your lab benefit from vendor consolidation?
-Can you have all the advantages of vendor consolidation and have vendors compete for your business?Read More
When qualifying a vendor there are many concepts to consider. First are the straight forward ideas such as do they have the item I need? Is it the best price? Can they deliver on time? And so on. These qualities are easily identified and readily accessible. There are many suppliers for NaCl for example both domestic and imported that offer the product in a variety of container sizes and can deliver the next day at competitive price via a multitude of shipping companies. This product is suitable if you are making a solution for a High School biology class. If, however, your needs are a bit more complex and you need greater control of your supply chain then knowing more about your vendor and their capabilities becomes critical:
-Can my vendor help me identify products manufactured under cGMP or USP? Does my vendor offer the reagents or materials I need in packaging that is suitable to my usage within a reasonable expiry?
-Will my vendor notify a small user like me when there is a change to the product in packaging, labeling or components? This is not a big deal when buying tires but critical when buying solutions or reagents!
-Can this vendor provide a proprietary custom product in a small volume within a reasonable amount of time? Additionally, do they have the capacity to scale up production if the product I have developed takes off?
Another vital aspect of the vendor qualification is determining the quality control that is provided by the supplier. What assays or tests are performed? Are these quality control tests adequate? Will the results of a particular lot be readily available in 5 years or 10 years?Read More
Are you getting the maximum benefit from your distributor contract or agreement? Don't assume that your distributor rep has the expertise or the motivation to guide you. Here are a few things to ask for that will help you get the most out of your existing agreement.Read More
Let’s face it. You don’t negotiate lab supply contracts very often. At best once every 3 – 5 years? The people you are negotiating with do this every day and they are much more skilled at this than you are. Your advantage is that you have what they want – money. You want as much for that money as you can get and they want to make as much profit as possible.
In many negotiations or RFP’s I've seen, customers who ask often get what they ask for even if what they ask for is far more than a lab of their size deserves. How do they do this?
They know WHAT to ask for.
They make the competition appear real. (Everyone has a favorite vendor of course and even if you play your cards very close to the vest, distributors know that an incumbent has a leg up in any negotiation.)
They aren't too eager to sign the agreement.
So what should you ask for? Here is my list of the top ten things you should ask for when negotiating contracts with a major distributor:Read More
How do you change your procurement department from a cost center to a profit center?
All businesses, including laboratories are looking for more options to increase their profits. Procurement functions, today, play an increasingly important role in improving business performance and productivity. To enhance business performance, laboratories are exploring new procurement models, which include widening the supplier base, making it more responsive and more flexible. Companies are partnering with procurement outsourcing providers in areas such as procurement analytics and procure-to-pay cycles.
Utilizing LPS procurement services, clients are able to achieve rapid, sustainable improvement in their procurement performance, drive innovation, alleviate risks with regard to supply and steer growth. LPS's procurement services deliver several benefits including sustainable long-term savings in procurement that directly impact the bottom line. LPS focuses on managing the clients' purchases by delivering process efficiencies through organizational efficiency and effectiveness, and creating measurable savings quickly. The LPS procurement outsourcing solution helps laboratories restructure and revitalize their procurement function.
Corporate downsizing has taken a toll in many organizations, especially in areas such as procurement, regarded historically as a cost center. With continued economic uncertainty and instability, companies are continually looking for ways to add to growth and contain costs to sustain growth.
By Paul McMinn | March 04, 2014
Profitable Procurement is an oxymoron; a phrase that, in and of itself, is a contradiction. Predominantly, business procurement generates expenses, which are deducted from income, thereby, diminishing profitability.
Preoccupied with “saving money” by leveraging volume to obtain lower prices, purchasing departments neglect opportunities to add to profitability.
“Savings” from lower prices on expense categories such as business essentials* do not convey directly to the bottom line, if at all. Obtaining a $0.10 lower price on cartons of copy paper does not produce savings traceable to your profitability.
Profitable Procurement contributes quantifiable profit directly to your bottom line through an innovative strategy of “selling” procurement process improvements plus aggregated purchasing volume to a single vendor and increasing your negotiating power exponentially.