Over the past decade, the value that procurement and strategic sourcing have brought to Canadian businesses has been immense. Some of the most innovative operational streamlining and efficiency solutions that I have seen were all born from the supply chain department. And yet, today many procurement executives are struggling to find new approaches to deliver new, sustainable value.
Some still feel that they are struggling to gain or maintain their seat at the executive table.
“In order to shift this perception, procurement executives need to showcase their achievements in a way that will resonate with the C-suite,” suggests strategicsourcing.com
“For example, rather than talking about costs of goods sold, focus on the return on assets. Or instead of looking at days of inventory, talk about the cash-to-cycle time.”
Corporate trade: a smart tool for strategic sourcing
Although corporate trade has been a familiar solution within the media market for many years, it is a relatively “new” tool for strategic sourcing professionals, and quickly gaining traction.
Essentially, corporate trade enables an organization to use their excess assets to pay for common business expenses. The assets are monetized into trade credit currency, and the trade credits are used with cash to pay various bills. Below are 5 ways that procurement professionals can use trade credits to lower everyday expenses as much as 15%
If your business spends $1 million or more per year on advertising (including digital), you can potentially lower the cash cost by an annual average of 15% with trade credits. A good corporate trade provider will work collaboratively with your existing media agency (who plays a critical role in the process) to execute all or a portion of the plan they created, without charging incremental fees.
Your turn: what are some of the most painful business expenses that your procurement team needs help with? What are the most innovative ways that strategic sourcing has overcome cost challenges?