Procurement Consultants: Who They Are and Why You Need Them
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Published:
August 23, 2023
Reading Time:
7 minutes
Ever wondered how some companies manage to secure the best deals, keep procurement costs to the minimum, and sail smoothly through market storms? Well, there’s one group of professionals who should get the credit for this—procurement consultants.
You see, procurement is more complex than people think. Imagine dealing with suppliers, negotiating favorable terms with them, and then strategically managing one’s inventory to avoid costly pitfalls. Well, it can be a headache if a business leader doesn’t have expert guidance.
In this article, we’ll talk about the unsung heroes who make the procurement process a heck of a lot easier. We’ll discuss who procurement consultants are, how they can help, and where to find the best ones.
So, let’s dive into it.
You see, procurement is more complex than people think. Imagine dealing with suppliers, negotiating favorable terms with them, and then strategically managing one’s inventory to avoid costly pitfalls. Well, it can be a headache if a business leader doesn’t have expert guidance.
In this article, we’ll talk about the unsung heroes who make the procurement process a heck of a lot easier. We’ll discuss who procurement consultants are, how they can help, and where to find the best ones.
So, let’s dive into it.
What Is a Procurement Consultant?
A procurement consultant is an expert who specializes in enhancing an organization's purchasing processes. Basically, they are efficiency experts—dedicated to making sure that every purchase a company makes is smart, cost-effective, and aligned with its goals. These experts research and analyze the supply marketplace to ensure you’re not wasting money in the wrong places.
Well, that’s too simple of an explanation, so let’s understand their role with an example. Let’s suppose company X wants to streamline their procurement operations, negotiate more favorable deals with suppliers, and ultimately boost their bottom line. They recognize that to achieve all this, they need a procurement strategy consultant. So, they hire one named Chris.
After coming on board, Chris turns out to be a helpful partner with lots of experience, knowledge, and practical ideas. The management team in charge at Company X learns that buying raw materials is more than just shopping—it involves dealing with suppliers, managing risks, understanding money matters, and making operations run smoothly.
First, the consultant begins by carefully studying how Company X purchases raw materials. He looks for complexities in the supply chain, finds where processes could be simpler, and discovers areas of improvement. Then, he works closely with Company X's team, sharing the best ways to manage procurement and comparing it with how other successful companies do it. Chris is also a great negotiator. So, he talks with suppliers to make sure Company X gets good deals and saves money.
Well, that’s too simple of an explanation, so let’s understand their role with an example. Let’s suppose company X wants to streamline their procurement operations, negotiate more favorable deals with suppliers, and ultimately boost their bottom line. They recognize that to achieve all this, they need a procurement strategy consultant. So, they hire one named Chris.
After coming on board, Chris turns out to be a helpful partner with lots of experience, knowledge, and practical ideas. The management team in charge at Company X learns that buying raw materials is more than just shopping—it involves dealing with suppliers, managing risks, understanding money matters, and making operations run smoothly.
First, the consultant begins by carefully studying how Company X purchases raw materials. He looks for complexities in the supply chain, finds where processes could be simpler, and discovers areas of improvement. Then, he works closely with Company X's team, sharing the best ways to manage procurement and comparing it with how other successful companies do it. Chris is also a great negotiator. So, he talks with suppliers to make sure Company X gets good deals and saves money.
KEY TAKEAWAYS
- Procurement consultants are experts dedicated to optimizing an organization's purchasing processes, aiming for improved efficiency and significant cost savings.
Why You Need a Procurement Strategy
Alright, now that you have some background knowledge on the role of procurement strategy consultants, let’s understand why exactly you need a procurement strategy in the first place.
1. Risk management
Let’s face it: procurement comes with risks. Whether it’s supply chain disruptions, conflicts with vendors, or market fluctuations, unprecedented events can impact a company's operations at any time. That’s why you need a robust procurement strategy. It should include measures to identify and manage these risks to ensure your business keeps running smoothly even in turbulent times.2. Inventory management
A well-thought-out procurement strategy means you have the right amount of inventory at the right time. According to page 8 of this report, effectively addressing stock-outs and overstocks has been shown to result in a reduction of up to 10% in inventory costs. Imagine this: you’re running a bed sheet manufacturing factory and you only need 50 gallons of fabric dye every week. But due to improper planning, you buy 80 gallons—money wasted! A smart strategy can help you prevent overstocking or understocking. Furthermore, it can minimize holding costs and help you maintain efficient operations.3. Quality checks
Another advantage of a robust procurement strategy is getting hold of high-quality goods and services. You must know what you will not settle for and set the right quality standards from the get-go. The quality assurance process also includes conducting supplier evaluations and implementing quality control measures. This will ensure that you maintain consistent product and service quality and also meet customers’ expectations as well as legal requirements set by authorities.4. Value optimization
Get this right: the main goal of any procurement strategy should be to gain value from every procurement activity. Getting the most out of every purchase doesn’t necessarily mean buying the cheapest materials from an unreliable supplier. In reality, you need to maintain a balance between three aspects: cost, quality, and delivery. So, avoid buying cheaper materials that are of average quality and will take ages to deliver. The ideal scenario is one in which you can procure high-quality materials at an affordable price that can be delivered before the deadline. Well, the aforementioned event may be way more complicated in real life, so it’s better to create a strong procurement strategy beforehand.5. Cost savings
Even if reasons 1-4 don’t satisfy you, this one will. You should have a procurement strategy in place simply to save as much money as possible. With the right strategy in place, you can form alliances with suppliers which results in better pricing terms, contract terms, and discounts. Furthermore, with the right strategy in place, you could forecast demand accurately which will help minimize excess inventory and associated logistics costs. Finally, you'll be able to make informed decisions by considering the ownership costs, maintenance costs, transportation costs, and any other costs.When You Should Hire a Procurement Consultant
Okay. Now that we have discussed the need to have a robust procurement strategy, let’s move one step further. You see, sometimes, you could create your own procurement strategy. But in some cases, it’s better to hire an expert and let them do it for you. So, let’s understand the scenarios in which you should seek help from a procurement strategy consultant.
1. No in-house expertise
Does your in-house team lack the necessary skills and knowledge to handle procurement efficiently? Well, in that case, you may need a consultant to fill the gap. Top procurement consultants have years of experience in the field and they can see solutions where a newbie sees a dead end.2. Complicated procurement process
Does your procurement process involve multiple suppliers, contracts full of legal jargon, and intricate supply chains? In this case, as well, experts can be of great help. With their immense knowledge and experience, they can analyze your existing processes, contracts, and supply chains, and use them to detect inefficiencies and areas for improvement.3. Changes in the company
If your organization is engaged in expansion, restructuring, or any other major change, you should probably seek counsel from a procurement consultant. They can examine the specific change and consider factors like increased demand, different supplier landscapes, and regulatory nuances to come up with a foolproof strategy. This ensures that the change doesn’t slow down business and that operations keep running as they did before implementing the change.4. Cost savings
Well, here we go again with cost savings. If the internal team has run out of ideas to save costs during the procurement process, you could bring a consultant on board for guidance. They can analyze your company’s spending patterns, negotiate with suppliers, and identify areas for savings. You see, sometimes, all you need is a third-party perspective to save tons of money.5. New technology implementation
Are you thinking about implementing a new procurement technology or software? Then maybe a seasoned consultant can help by choosing the right software for you and creating a customized implementation plan. Whether it’s the configuration, data migration, or testing phase of new technology, consultants can ensure that it integrates seamlessly with existing workflows. Furthermore, experts can offer hands-on training on-site and continue monitoring your progress post-implementation.Where to Find Procurement Consultants?
Have you got a tricky global sourcing problem that’s bothering you? Need to save some cash without sacrificing quality? Or maybe you’re looking to use technology to smoothen your procurement process. Here at Consultport, we have the best procurement strategy consultants in our network who can do all that for you.
We have access to a range of procurement experts who can transform your business’s procurement process. And we have a wide range of consultants with different skill sets, too. Our Procurement Specialists can reimagine your strategies, Procurement Cost Reduction Consultants can find hidden ways to save more, and IT Sourcing Consultants can boost your tech efficiency.
If you’re into global markets, we’ve still got your back—you can turn to our Global Sourcing Specialist to create the perfect global supplier network. Want to digitalize? Well, then our E-Sourcing Specialists can help you navigate the digital landscape.
All consultants in our network have worked for top consultancies and blue-chip companies. This means that you’ll only speak to the best of the best.
Get in touch now, and take your procurement process to new heights!
We have access to a range of procurement experts who can transform your business’s procurement process. And we have a wide range of consultants with different skill sets, too. Our Procurement Specialists can reimagine your strategies, Procurement Cost Reduction Consultants can find hidden ways to save more, and IT Sourcing Consultants can boost your tech efficiency.
If you’re into global markets, we’ve still got your back—you can turn to our Global Sourcing Specialist to create the perfect global supplier network. Want to digitalize? Well, then our E-Sourcing Specialists can help you navigate the digital landscape.
All consultants in our network have worked for top consultancies and blue-chip companies. This means that you’ll only speak to the best of the best.
Get in touch now, and take your procurement process to new heights!
