In order to determine if a PSP (Procurement Sourcing Partner) is right for your business, it is essential to understand the purpose of a sourcing partner for procurement. In short, a PSP manages supplier identification, screening, purchasing, sourcing, and analytics for your organisation.

 

More than Procurement

A PSP provides more than simply purchasing goods and services for your company. An effective procurement partner must be able to analyse and understand the needs of a particular business. They support the flow of goods and services by ensuring purchases are made in the correct quantity, from the best sources, and at the right time.

 

Analytics

Analytics play an essential role in optimal purchasing. A PSP tracks your purchasing needs, analyzing the data to determine the best purchasing decisions. Smart purchasing begins with reliable data and the ability to comprehend the numbers. Understanding the supply needs of your business allows a PSP to create a systematic purchasing process that is in line with your business objectives.

 

Sourcing

A good PSP has established relationships with many suppliers. They have access to, and knowledge of the best sources. Because of this, a procurement partner acquires better products at a lower price than you could likely get on your own. A PSP spends the necessary time and effort fostering relationships with suppliers, so their clients receive the best deals. This is an important role of a PSP, because business owners simply have too much on their plates to worry about supplier relations.

 

Savings

The immediate savings business owners often see when employing a PSP is one of the primary reasons so many organizations use a PSP. Through group purchasing, a procurement partner will get lower prices. The analytics serve to ensure your business is not over or under purchasing supplies. They are also able to find hidden opportunities in the supply chain.

 

Planning

A PSP plans the optimal procurement strategy for your specific business. It is sometimes said, “failure to plan is planning to fail.” The importance of strategy and planning cannot be understated. Supplies must be purchased and delivered to the correct locations at the right time, at the lowest price, from the best sources. This enables you to provide great services for your customers and guests.

 

 

Extended wing to In-house Procurement Team

By using a PSP, you do not need to employ additional in-house procurement professionals. Outsourcing these responsibilities to a PSP removes the stress of purchasing. This allows business owners and team members to focus on other objectives. Peace of mind purchasing is such a huge part of running a successful business, and it can be overwhelming. Many managers and business owners hire a PSP simply for the peace of mind. It is comforting to know a professional organisation is handling all your procurement needs. This is especially useful when you have numerous locations to juggle. Keeping track of purchasing demands is stressful. A PSP alleviates much of the anxiety surrounding procurement.

 

A PSP is a comprehensive procurement solution. Be aware that not all Procurement service partners are created equal. They offer a wide variety of services and you want to ensure you find one that meets the needs of your specific business. Finding a PSP that specialize in your industry is essential. Experience and an openness to innovation are additional factors to consider. Experience ensures that a PSP has the track record and relationships necessary to get the best results. A willingness to embrace innovation ensures your business stays on the leading-edge of the procurement process. If you are seeking a cost-effective, worry-free solution for purchasing, a PSP is probably right for you.