Ravages of Brexit will soon strike the London Bridge down, even though not literally, this ongoing tumult has already struck the bridge down between procurers and a favorable procurement scenario in the UK banking industry. Against this backdrop, SpendEdge’s Tridib Bora discusses the possible procurement risks and accordingly advises the procurement best practices that can effectively bridge this gap in the current UK banking industry.

From a procurement perspective, what are the major impact of Brexit on the UK banking industry?

Tridib: Before I answer this, I will state the importance of gaining actionable procurement insights into this industry. Historically, the UK banking industry has been subjected to frequent ups and downs, which have brought about periodic dynamism in this industry. However, I have no ounce of doubt about the fact that recent uncertainties over Brexit will have a significant impact on this industry. Such frequent dynamisms are changing the way businesses function across the UK banking industry, creating major procurement challenges in this industry. From a procurement perspective, such uncertainties are posing major challenges for companies operating in the UK banking industry. This makes it imperative to gain deep insights into the present and the future procurement trends, including suitable procurement best practices for the UK banking industry.

Coming back to the question, the extreme dynamic regulations and deregulations will fire up the supplier’s compliance costs, thus, accelerating the procurement expenditure for buyers in the UK banking industry. Mulling over the uncertainties brought on by Brexit, most of the suppliers are shifting their bases away from the UK. This will have a two-way inflationary impact on the procurement expenditure in the UK banking industry. Firstly, with most of the suppliers moving out, the resultant demand and supply ratio disbalance will shoot up the price of banking products and services in the UK. Secondly, to procure from suppliers that are no more located within the regional boundary, buyers will pay double the procurement price of the products and services.

What are the procurement best practices that companies can follow to become market leaders in the UK banking industry?

 Due to such dynamism, the need of the hour is to have real-time insights into the procurement and price trends that are driving the UK banking industry. In this context, it is worthwhile to mention that SpendEdge’s recen procurement intelligence report on the banking services industry identified the main procurement pain points and other risk factors faced in the current UK banking industry and listed out the procurement best practices to be adopted in this industry. For instance, in this limited supply market, it is not prudent of buyers to engage with multiple suppliers for different banking services. Instead, they must evaluate the capability of suppliers to offer value-added services such as escrow services, asset valuation, payroll services, investment accounting, among others.

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Considering the dynamic regulatory framework, one of the highly recommended UK banking procurement best practices is to engage with suppliers who have strong security and use a layered structure approach. For instance, layered security in online banking includes steps such as user authentication, device authentication, browser authentication, transaction authentication, transaction authentication, and application security.

I recommend the assessment of the supplier’s technical capabilities as another highly recommended UK banking industry procurement best practice. The adoption of intuitive technologies such as blockchain, AI, and big data analytics by suppliers will help them stay abreast with the dynamics of the UK banking industry and help them to adapt to the same. This will benefit buyers with the procurement of banking services and products that are attuned to the industry dynamics.

Effective sourcing in the UK banking industry is no cakewalk. Request more information from SpendEdge’s experts and gain real-time insights into the sourcing strategies and procurement best practices will help buyers devise sustainable and futuristic procurement strategies befitting the industry dynamics.

Does SpendEdge have any first-hand experience in helping enterprises in the financial sector including the banking industry overcome such procurement challenges?

Yes. Currently, SpendEdge is one of the most preferred procurement intelligence firm who has its unique way of analyzing the potential challenges and resolving them with the future market scenario in mind. To quote a few, SpendEdge conducted a robust spend analysis process that helped a leading multinational financial services company save about USD 30 million.