Supply Value has conducted research into key trends and developments in the field of procurement for the coming year in collaboration with several purchasing organization. In the study 551 respondents have participated. 51% of respondents are from Europe, 33% from North America and 11% from Asia. The Netherlands is the largest group with 32% of respondents, followed by the USA with 30% and Belgium with 11%.

Top 3 Purchasing Trends 2015

The top three purchasing trends for 2015 are:
1) More attention to supply chain optimization
2) More focus on cost reduction
3) More need for flexibility

Trend 1: Supply Chain Optimization

The purchasing trend “more attention to supply chain optimization” has risen from eighth place (score 3.8 on a scale of 1 to 5) in 2014 to first place (score 4.15) in 2015. Supply chain optimization is seen in today’s market as the way to further to achieve improvements. To achieve supply chain optimization, organizations need to work better together. Organizations need to look at the entire value chain and ensure that information and knowledge within the chain is shared optimally.

Trend 2: Cost Reduction

The purchasing trend “more focus on cost savings” (no. 3 in 2014) is again seen in 2015 as one of the most important purchasing trends. This year, this trend has risen to location 2. Many organizations are looking for ways to improve their bottom line. Increasing sales is becoming increasingly difficult as the market growth in many markets is very limited. This look more and more organizations to be able to further reduce costs. Purchasing is seen as the ideal partner to realize cost savings.

Trend 3: Flexibility

The purchasing trend “more need for flexibility” (no. 1 in 2014) is also a major trend in 2015. However, this trend has dropped to number three for 2015. In the current market organizations are not keen on volume obligations for a long period due to a large uncertainty in market demand. Organizations look for ways to reduce their risk, but still be able to negotiate delivery guarantees.

Recommendations for 2015

Based upon the top 3 trends for 2015, Supply Value recommends the following three actions in 2015:
1) Competence-based partner selection
2) Joint saving initiatives
3) Proactively share expectations

Recommendation 1: Competence-based partner selection
Select your strategic supply chain partners based on their skills and experiences. This makes it possible to not only select a partner on their current offering, but also on their future potential. Selection criteria such as innovation, education level of employees, investment in R&D, training and knowledge are some criteria that you can use to select the right partner.

In addition to selecting the correct partner, managing and developing the relationship is important. Through open and clear communication with your supply chain partners and to work together on share improvement initiatives is the chance to work together more successfully. Make sure there is not only cooperation on an operational level, but also involve the management of both parties. This can increase the involvement of both parties and make sure that the relationship is given sufficient attention by the management.

Recommendation 2: Joint saving initiatives
Research saving initiatives in the supply chain toghether with key stakeholders and partners. By examining improvements together, the likelihood of good and executable ideas increases. To encourage your partners to come up with good ideas you can agree a bonus / malus system, such as: “20% of the realized savings is assigned to the partner” or “40% of the realized savings is invested in innovation of the partner “.

Recommendation 3: Proactively share expectations
If the organization has a high need for flexibility, make sure that you find a good balance between delivery guarantees, flexibility and volume fluctuations. Inform your partners proactive about your expectations and market developments. By sharing this information chain partners can anticipate on changes in a timely manner, without that you have to promise a specific amount of purchasing.

 

About Supply Value
Supply Value makes organizations work smarter with suppliers. This allows them to make more profit and create value at less cost and risk. We do this by helping organizations to formulate and implement sourcing strategies, professionalize of the procurement function and optimizing the value chain.

Supply Value was founded in 2007, is ISO 9001 certified and is assessed by its customers with an average of 8.4. 90% of our customers recommends us with a score of 5 (on a scale from 1-5). For more information about Supply Value, please visit www.supplyvalue.nl

 

For more information
Please contact: Ramon Abbenhuis (Consultant, M: 0031 (0)6 55833180, E: r.abbenhuis@supplyvalue.nl ) or
Menno van Drunen, Managing Partner, M: 0031 (0)6 24516244, E: m.drunen@supplyvalue.nl

Or visit our Slideshare presentation with more indept information. Please visit: www.slideshare.net/supplyvalue