6 MIN. READ
In today’s business climate, reducing operating costs and increasing efficiencies are priorities for most facility managers and building owners. Implementing strategies to cut expenses, improve NOI, and streamline purchasing processes is vital to a company’s growth and performance. Fortunately, Raiven has an online platform that makes strategic sourcing and supplier and contractor management easy.
Procurement centralization and optimization allow facility and property managers to take control of expenses and rein in rogue spending. The aim is to have one department or location that manages all the purchasing decisions within the company.
Without proper management and guidance, employees are on their own to figure out how to order building supplies, which can wreak havoc on budgets and NOI. When employees purchase items without clear guidelines, outside the company’s purchasing parameters, expenses spiral out of control, and are difficult to get back on track.
Pros of centralized procurement include:
Implementing a centralized procurement platform and utilizing strategic sourcing can save money and simplify the way routine purchases and other business activities are conducted. Employees benefit from a simpler, more structured process that is clear and within your company’s purchasing guidelines.
Strategic sourcing is a method for businesses and managers to analyze spending within the organization, continuously find the best deals on supplies, manage and cultivate relationships with suppliers, and ensure compliance. When introduced successfully, it offers great benefits, such as:
When implementing a strategic sourcing program in your organization, there are several things to consider:
Now more than ever, businesses are looking at ways to increase savings to support a larger NOI. By unifying material purchasing and reducing operation costs, property managers can put their assets to work, increasing profits without much upfront cost. Without understanding existing systems, growth cannot occur, and property owners may find their profits suffering. With a robust online purchasing platform like Raiven, you can run strategic sourcing and contractor management from a single location.
Rogue spending may provide a short-term solution for a multi-family property manager. However, the long-term impact of rogue spending outside a discounted supplier can be severe.
With no planning, employees will follow easy methods that are the quickest to do. This lack of direction ruins a budget and harms a building’s NOI. Spending on random, one-time suppliers can be hard to track. You also lose out on the savings volume purchases can offer. Building relationships is a big part of procurement. If it is ignored, businesses can lose out on the benefits offered by industry-leading suppliers with the quality that other suppliers lack.
Here are the pros of centralized procurement:
By creating a procurement system for your employees, you can save money and enjoy the benefits of an easy-to-manage purchasing process. Your buyers will benefit from an easy process with guidelines that remove the guesswork from purchasing materials.
Centralized procurement is a strategy that helps remove unnecessary expenses like rogue spending by giving all purchasing power to one individual or department within a company.
With a central purchasing group, you can manage spending analysis, source the best quality materials for the best prices, and build relationships with reliable suppliers. By committing resources to this area, you can explore these money-saving goals:
Facility managers routinely purchase building stock, cleaning supplies, maintenance materials, PPE, tools, and other essentials, looking for the best deals in order to save money. The beauty of Raiven’s platform is that suppliers are grouped in a marketplace, and through economies of scale, better rates are negotiated for the benefit of all purchasers.
Automating and centralizing these routine processes saves time and increases efficiencies. Employees will not need to surf websites like Amazon to source items when they have a clean marketplace that allows them to choose from nationwide suppliers, like Grainger, Ferguson, and Office Depot. Purchases are made securely and quickly at the best pricing available.
When employees shop online using Raiven’s browser extension, they are alerted when a better price is found from one of their preferred suppliers. This leads to improved decision-making, time and money savings, and increased productivity. Raiven works on a variety of websites, including Amazon, showing employees where they can purchase the item from one of your approved suppliers, bringing your buyers back into compliant purchasing.
Following these best practices will have a positive impact on your bottom line and will also tie together other facets of your procurement program, such as supplier consolidation and compliance.
Managing one supplier can be challenging, but trying to manage tens or even hundreds of suppliers is extremely difficult and usually results in issues that escalate into major problems and headaches for your team. It also takes up precious time and resources.
A vast supplier pool typically stems from good intentions. Team members want to onboard suppliers that they built solid relationships with at previous places of employment. However, if several employees take this approach, the result will be an excess of suppliers in the system, and inevitably, many of them will end up being overpriced underperformers.
Having a limited number of vetted suppliers that are proven performers and can provide cost savings to your business is essential. As a property manager, there is no need to waste time with suppliers that do not give you the best benefits for your money. Ideally, you want a limited supplier base that has been thoroughly vetted, qualified, and approved by management.
Here are a few benefits of consolidating your suppliers with Raiven:
Understanding and implementing a centralized procurement and supplier consolidation program will transform your business, optimize efficiency, and save you money. When looking to cut costs across your organization, these are key areas that cannot be overlooked.
Take advantage of numerous benefits, like the ease of purchasing, preferred pricing from select suppliers, and smoother management of contractors and compliance, all through Raiven’s innovative platform. Discover how Raiven can help you centralize, optimize, consolidate, and increase NOI today. Reach out today to get more information or schedule a demo.