Procurement Category Management Services
Procurement category management are groups of similar goods and services with similar demand and supply drivers and sources. Learn how to determine procurement categories for commodities and services.
Why Use Procurement Management
Procurement categories can help to streamline operations and boost output. You can use procurement categories to:
1. Design focused procurement strategies for related items and services
2. Gain a better view of your company’s procurement spending
3. Create substantial discounts
4. To cover a category of numerous transactions, create aggregated supply arrangements.
Subcategories And Categories Of Our Procurement
To benefit from the growing competition, procurement categories must be broad enough. Around ten broad categories should be enough to cover a large portion of your company’s spending. If there’s a need for more differentiation, a category of products or services may include sub-categories, such as:
A category is a collection of goods or services that have similar supply and demand factors and suppliers.
A logical subgrouping inside a category with comparable good and services features is called a sub-category.
How To Define Procurement Management
The process of establishing categories entails mapping the spend data of an organization/business unit. Personnel having appropriate knowledge and insight into the organization’s spend & procurement activities should map out spending and establish procurement category management.
7 Steps To Defining Procurement Category Management
1. Spend time locating acceptable data.
2. Remove any line items that aren’t from a supplier.
3. Sort the spending information into categories.
4. How useful are subcategories? If sub-categories are advantageous, proceed to step and If subcategories aren’t helpful, move on to step 6.
5. Group procurements by category and sub-category when possible.
6. Make sure the categories and subcategories make sense.
7. Subcategories and categories for document procurement.
Our Cost Saving Procurement Category Management Services
Almost every facet of every organization in every industry requires a trustworthy supply chain that can deliver products and services quickly and confidently without compromising quality.
Our goal is to help your company achieve procurement excellence by facilitating relationships that serve the needs for today and tomorrow. We give you the tools to visualize your cost management at every stage, reducing risk while fulfilling your purchasing spend and quality objectives. The average savings customers see each year in active and passive spend areas are significant.
Increased Compliance With Our Services
You may get more control and insight over all this category of spending by centralizing services procurement. It can also help to reduce security concerns, improve compliance with any existing milestones, and verify that vendors follow all business regulations.
Employee identification is among the most significant dangers that businesses face, and it can be difficult to identify and control without centralized management. It can result in significant financial consequences.
Furthermore, it exposes businesses to liability for violations of federal and state wage and hour rules, overtime consequences, employment tax and workers’ insurance issues, and benefit plans concerns.
Frequently Asked Question
MSP and VMS companies can share industry best practices gleaned from controlling the services procurement budget of other clients. Sharing knowledge and experiences learned allows firms to get the most from their purchasing processes, negotiate the best deals, and gain a competitive advantage.
Years ago, outsourced labor tracking technologies and services mostly focused on manpower tracking, transparency, and risk reduction. More organizations began controlling this cost via a VMS/MSP as VMS capabilities and user experience increased, and MSPs began to acquire professionals with experience in project-based spend management.
The products & services document library has a Microsoft Word version of a Defining procurement groups – products & services procurement guide. Kindly inform the goods and services planning team for further information on establishing procurement categories for products & services procurement policies.
Sub-categories allow you to group related items and services together even more, allowing you to design applicability that go across the board rather than defining a plan for each particular procurement transaction.
The products and services distribution policies are accompanied by this guide. There are five different supply policies:
Policy on Governance
Policy on assessing complexity and capacity
Market research and policy evaluation
Market-oriented policy
Policy on project delivery and disclosure
The Governance policy is supported by this handbook.