Author: Alun Rafique – CEO & Co-founder, Market Dojo | Read time: 5 minutes
In this article, we explore how you can improve your supply chain resilience by understanding your supply chain data, improving supplier competition, and by strengthening collaboration with internal stakeholders and suppliers.
We also provide practical examples of how procurement teams have used reverse auctions to save significant amounts of money, and how the use of digital solutions can help companies react faster and gain a competitive edge.
Following the tumultuous last few years and sharp increases in prices of commodities such as fertiliser, aluminium, coal, and steel, for many companies the focus for businesses has been supply chain resilience and this continues to be as important going into 2023.
But, if your supply chain resilience is below par, where do you start?
We recommend that you start with understanding your supply chain data and making sure that you can take effective action.
For our customers, data comes from two sources: firstly internal data for example the contracts you have with suppliers, and second, external data such as truly understanding your supply chain:
Once you have a solid understanding of your supply chain, you can start introducing strategies to be more resilient, for example looking at nearshoring opportunities for buying goods and materials.
To address reducing costs, reverse auctions are an effective way of introducing competition to your supply chain by getting the best price available from suppliers, and in a highly inflationary market, to mitigate against price rises.
One of our customers, an OEM for the automotive industry, spent £500 on a month’s licence to Sourcing Dojo to run an auction for non-metallic fasteners and saved £40 million on a five year contract.
Typical savings are between 10-20% on sourcing goods and services by customers using Market Dojo’s software.
Proactive procurement professionals recognise the benefits of online collaboration tools to communicate better with both internal stakeholders and suppliers.
Procurement teams have many points of interaction and required communication within an organisation, for example day to day within procurement teams, between buyers and managers/senior executives, and to provide data/reports to stakeholders.
Then, outside of an organisation, there are suppliers who have been managed traditionally through emails and spreadsheets.
Communicating to suppliers through emails and spreadsheets is not scalable and data can be lost. Results from tender tend to be worse as buyers aren’t able to go out to enough suppliers to get the best prices and contract terms.
By having an efficient system, companies are able to scale quickly and communicate with a large number of suppliers (and their suppliers’ suppliers). This helps create fair, transparent, open and organised communication which will strengthen supplier relations, thus building resilience. In addition, where ‘one size fits all’ ERP systems are in place, greater value can be delivered through agile, ‘best of breed’ solutions.
In the first three months of the pandemic, use of our on-demand sourcing and supplier onboarding software, grew dramatically.
Since then, we continue to witness how organisations who adopt digital solutions to manage their supply chain, are able to react faster, understand the options available to them, then take the necessary action to gain a competitive edge.
To find out how Market Dojo is transforming procurement, book a demo with our team.
For more ways on how to strategically navigate through the increasing pressures within procurement in 2023 download our Procurement Pathfinder eGuide