Tag: procurement challenges

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Manufacturing Industry: Manufacturing Cost Strategies, Procurement Challenge, Supply Market Trends to Watch Out for in 2019

LONDON: SpendEdge, a global procurement market intelligence firm, has announced the release of their report portfolio on the global manufacturing industry.

While technology is playing a big role in transforming production processes in the global manufacturing industry, a majority of the key industry players are struggling to identify optimal manufacturing cost strategies to deploy the newest innovations in their business infrastructure. An industrial manufacturing project typically entails an indefinite procurement spend, which pose as a major procurement challenge for the stakeholders to morph their current cost strategies to make space for additional investments. Established companies who boast a full gamut of industrial operations are still managing to eke out profits from their customer base.

However, SpendEdge argues that the marketplace is one unforgiving forum where the ability to identify and adapt to new trends defines the success of firms. The Industry 4.0 revolution, which asserts the necessity of adopting automation in the manufacturing process, is mounting additional pressure on category managers who are struggling to revamp their old-school business model to usher in the breakthrough capabilities without loosening their purse strings. A majority of such category managers are finding answers to such procurement challenge in the market intelligence reports developed by the procurement experts at SpendEdge. These reports help in the creation of a tangible procurement strategy along with optimal manufacturing cost strategies that befit the changing trends of this market space. By assessing the potential risks affecting the market, these sourcing and procurement reports recommend a set of procurement best practices that are meant to foster stability while practicing business in this market. (more…)

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3 Procurement Trends That Can Change the Dynamics of the Mining Industry in 2019

Today commodities are moving back broadly into the global market balance but the challenges for the mining industry are far from over. In a world of more complex ore bodies, deeper mines, social and geopolitical risks, growing energy costs, resource nationalism and lack of infrastructure, global mining industry remains under exceptional pressure to control costs, boost efficiency and improve safety performance.

Rising cost is a cause of concern for the mining industry as the strategies of mining companies depend heavily on the current state of the market. Also, the rise in cost is resulting in the declining quality of ore and limited accessibility of new deposits. This will squeeze the supply in the years to come, potentially driving a commodity-price rebound as the global demand continues to rise. So, the companies need to analyze the new procurement trends in the mining industry that can offer exceptional opportunities for efficiency gains and can help in controlling costs as well.

At SpendEdge, we understand the impact that rapidly changing procurement trends can have on your mining business. And to help companies in the global mining industry to reposition their portfolios and excel in the competitive landscape, our team of experts has highlighted three procurement treContact USnds that have the potential to change the complete dynamics of the mining industry in 2019.

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Ask me Anything: Everything You Want to Know About Catalog Management

What is Catalog Management?

Catalog management is a dynamic process where products are structured in a specific manner to ensure the availability of high-quality and consistent data across all channels of sales. An online catalog offers names of product, hierarchy, descriptions, supplier, price, and other necessary details. Proper catalog management provides granular details like style, color, pattern, sleeve, neckline, length, and fit, which help drive the customers to the right product. Catalogs are generated by tagging products based on different attributes that are used to classify and segregate products. These tags need to be SEO ready, consistent, and descriptive.

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Procurement Technology: Top 4 Ways it is Impacting Supply Chain Functions

The continuous influx of innovation in the field of procurement and sourcing has made supply chain functions simpler by eliminating tiring paperwork and automating complex as well as simple tasks. Procurement technology solutions like e-procurement tools and many others significantly benefit businesses by allowing better visibility, greater productivity, and cost efficiency. Traditional techniques such as category expertise and supplier relationship management are still relevant but the new procurement technology solutions are transforming the way businesses approach supplier negotiation, contract management, category management, and reverse auction. The high degree of granularity achieved through the use of procurement technology enhances business agility, drives continuous process improvement, and supports an operating model that boosts business excellence within procurement and supply chain functions. In this article, we have talked about a few interesting ways in which procurement technology is impacting supply chain functions.

Procurement Technology in Supply Chain Functions

Mobile procurement has made supply chain efficient

We cannot deny the fact that procurement professionals are on the move and demand instant information. This is where procurement technology plays an important role. It empowers them to drive better value and results. With such technology, organizations can streamline their procurement processes and supply chain functions with features like purchase order creation, demand notifications and real-time analytics from a mobile device. Procurement professionals can also request and compare items conveniently, providing them complete visibility on suppliers.

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Digital signatures have secured supply chain functions

Digital signature and certificates make the e-tendering process possible through its capacity to access information of buyers or services online and ensuring security. Digital signatures drive away the lengthy paperwork and allow for contracts to be carried out in lesser time. Additionally, this procurement technology also encourages automatic contracts and eases the request for proposal processes apart from simplifying the order of purchase.Contact US

E-catalogs have improved reliability

Unlike services catalog or traditional product, e-catalogs are interactive and can store huge quantities of items that can be classified and organized into different categories as per requirement. Such a procurement technology can be easily modified and edited on a recurrent basis and help in converting inquiries resulting in significant cost savings. 

Reduced operational costs in supply chain functions

Today, both small and medium business enterprises are migrating to cloud technology to enjoy the benefits of procurement technology solutions without investing much on IT infrastructures. Also, businesses are opting for a Software-as-a-Service (SaaS) model to meet their procurement needs. Such digital procurement platforms provide great value that in-house solutions can never match. Additionally, cloud migration can reduce the overall costs and provide scalability and flexibility to the organization.


SpendEdge offers customized procurement market intelligence solutions to help procurement and sourcing stakeholders make better business decisions. Are you looking for any solution? Request a proposal now!

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Top 5 Procurement Challenges Impacting Businesses in 2018

Today, no one can say that procurement professionals and sourcing teams have it easy. They face daunting challenges and struggle to stay abreast of all the regulatory changes happening around the globe. Procurement, for many, is an undervalued operation that impacts every facet of your business.  While there are many procurement challenges, each organization will face its own unique set of challenges. In this article, we’ll talk about some of the common procurement challenges that companies will face while sourcing goods and services this year.

TOP PROCUREMENT CHALLENGES


Effective risk management

risk management2Procurement challenges are an inherent part and parcel of every business process. Each business faces them at some point but managing them effectively is something that every procurement team struggles to do. With the focus shifting towards business expansion, it is no longer good enough to engage with tier 1 suppliers. Implementing an effective risk management strategy at the very start of the procurement process, therefore, becomes a necessity for companies looking to expand their boundaries. But before any company thinks about engaging with tier 2 or tier 3 suppliers, implementing risk mitigation strategies like analyzing the risk of each supplier, comprehensively understanding their supply chain, and putting backup plans in place in case things go wrong become essential.   

Read on to know more about procurement challenges.

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Why Should Your Organization Use Procure to Pay Software?

A procure to pay process in a typical organization is lengthy, time-consuming, and laborious. The process starts out with requirement planning, then RFQ, vendor selection, purchase order, goods receipt, order and goods assessment, payment invoice, and reporting. Manually going through all such processes can be hard and laden with errors. Additionally, an organization may be running multiple processes in parallel with numerous vendors, and tracking them might just go out of hand. A traditional procure to pay process involves a lot of checks, authorizations, paperwork, communication, and errors. With a flurry of innovations in this sector, automation has stood out as the clear winner as it helps organizations better understand their spend and increase contract compliance. So why should an organization use procure to pay software?

Benefits of Procure to Pay (P2P) Software

Enhanced spend visibility

Automation eliminates the requirement for a lot of paperwork and enforces manual checks within each stage of the procure to pay process. Automated procure to pay software provides end to end visibility between POs, goods receipts, invoices, and other documents to ensure goods are as per specification before issuing payment. By providing real-time data to both buyers and suppliers, it offers better srequest proposalpend visibility.

Easy access to records

Procure to pay software eliminates all the paperwork and stores all records in the system digitally. As a result, it becomes easier when procurement professionals want to retrieve data on a particular supplier or transaction. They can get the data instantly, rather than having to go through all the files and documents. Also, buyers can easily access the online catalogs from suppliers, and also review and approve purchase orders in electronic formats. Additionally, the cloud-based system can provide selective permissions and encryption to allow multiple levels of access. It can also generate automated reminders to alert users when purchase orders are pending or require approvals.

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Catalog management

Contracts are an essential document for any organization. Hence, they store such documents regardless of importance or time. However, it’s not the same with catalogs; they only keep catalogs from a selected few suppliers. Procurement professionals cannot access information on suppliers past offerings or offerings from new suppliers as they do not have their catalogs. An automated procure to pay software helps procurement professionals to link the software with the contract management system and store contracts in the absence of catalogs of a supplier. Such software assists procurement professionals to fetch details and historical costs of previous orders from a particular supplier even without a catalog.

Proactive reporting

The automated procure to pay software has the ability to create reports that provide more profound insights into supplier performance. It can detail over supplier spends over various levels, compliance issues, and status of contracts and shipments. Such real-time reports are valuable to businesses as it assists them with strategic spend analysis and controls their maverick spend.


Want to gain better insights into procure to pay cycle and P2P software?

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The Largest Consumers of Crude Oil in the World

The world runs on money! Or oil! Crude oil to be more specific. It is unnecessary to explain the importance of crude oil in the world. We just have to look at the news, and how countries with oil resources have become rich. The Middle East is the biggest example of this statement. The statement, “the world runs on oil” not only talks about the political influence of oil-rich economies but also in its literal sense. It is because of crude oil that most of the vehicles are running on the road and the manufacturing units all across the world are still functional. The global crude oil consumption as of 2017 stood at 3.72 trillion metric tonnes. (SpendEdge – Procurement Market Intelligence Report) Although the world is moving towards clean energy, oil is still a significant part of the global economy.

Largest consumers of crude oil

APAC region

High economic growth in countries such as China, India, Singapore, and Indonesia has driven consumption and made APAC the leading market for crude oil in terms of consumption. Gasoline, kerosene, diesel fuel, and paraffin wax are amongst the major crude oil products consumed in this region. Such fuels are powering various industrial and domestic applications including automobile, chemical manufacturing, and road construction. In India, LPG consumption is very high, as it is the primary source of energy for daily cooking needs. Over the last decade, the production of natural gas in China has been shooting up; thus, driving the manufacturing of chemicals as it’s a clean fuel source. As a result, the overall demand for crude oil is expected to grow at a CAGR of 3%–4% over the forecast period

North America

In terms of consumption, the US is the largest market for crude oil, not only in North America but also globally. The country accounts for more than 20% of the global crude oil consumption. It is no wonder that the US has either issues or diplomatic relations with many countries in the Middle East. A high number of per capita vehicle ownership and energy consumption are the significant factors driving the consumption in this market. Additionally, the discovery of shale oil in the region has resulted in an increase in domestic production volumes of crude oil, which, in turn, has led to a decline in both price and imports of crude oil.

However, the growth of the natural gas market in the region, which can be attributed to the discovery of shale gas in the region, has resulted in several chemical suppliers using natural gas as fuel and feedstock to produce chemicals such as olefins and ethylene. These factors are expected to lead to a minimal growth in demand for crude oil in the region

Europe

Europe ranks third in terms of global crude oil consumption. The strong chemical and automotive market in France, Germany, and Russia are driving the consumption in this region. The region is also the fastest growing in terms of green energy as countries such as Sweden and Denmark are focusing on clean energy. Europe is also the leading market for electric cars (sales per capita) worldwide. Moreover, governments across the region have passed legislation to reduce the consumption of crude oil by employing stringent limitations on emissions of pollutants from the use of crude oil products. Consequently, the overall market for crude oil is expected to decline over the years.

MEA

MEA is one of the largest production hubs for crude oil. The region uses crude oil to produce chemicals such as EDC, VCM, ethylene, benzene, toluene, and olefins. Apart from the Middle East, high economic growth in African countries, such as Nigeria, is leading to the higher consumption of crude oil-based fuels. The only concern for crude oil market in this region is the surrounding political instability, civil war, and financial downturn. Such events can have a negative effect on both the demand and supply of crude oil, which will hamper the market growth.

South America

Venezuela is the country with largest oil reserve in the world, with an estimated proven oil reserve of over 250 billion barrels. In terms of consumption, it ranks third followed by Brazil and Argentina. Majority of the crude oil is used in the production of chemicals such as EDC, olefins, gasoline, diesel, and kerosene, which are then used in several end-user segments. The region, however, experiences a decline in crude oil demand due to the preference for biofuels such as ethanol.

 

Read more about the top consumers of crude oil with supply market insights, procurement challenges, pricing insights, and technological advancements in SpendEdge’s upcoming report on the global crude oil market.

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Upcoming Trends, Growth Drivers, and Burning Challenges in the Artificial Food Coloring Market

Looks and smell are the primary factors that attract people towards food. These two factors play such a significant role that it can psychologically alter human perception even if the food taste was different from how it was presented. Apart from enhancing the visual appeal of food products, artificial food coloring is also used to protect minerals and vitamins within the food during exposure to sunlight. Artificial or synthetic food colors are manufactured using chemical processes and are most commonly used in food and pharmaceutical industries. Such food coloring is available in powder, liquid, gel, or paste forms. Sunset yellow, tartrazine, carmoisine, erythrosine, Ponceau 4R, and brilliant blue FCF are some of the most commonly used food colors in the food sector. The procurement market intelligence report on global synthetic food color market identifies Europe as one of the largest markets occupying a 34% market share.

Request Free SampleTrends in artificial food coloring market

  • Today, the consumers increasingly prefer clean-label products which are free of any additives, preservatives, stabilizers, enhancers, and thickeners. Because of such preferences, consumers have prefer natural food coloring over synthetic food colors.
  • In the salmon aquaculture sector, the farm-raised salmon lack the pinkish color that is present in wild-salmon. As a result, artificial food colors are used in salmon fish fillets and in pigmenting supplements as a part of fish feed as well.
  • Colorful concoctions such as rainbow bagels and unicorn lattes in food products are possible because of innovations in the synthetic food coloring market. For instance, multi-color cereals, Marshmallow Only Lucky Charms launched by General Mills, are becoming increasingly popular among consumers.

Growth drivers in the artificial food coloring market

  • One of the largest application areas of artificial food coloring is its use in processed foods such as confectionaries, sausages, soft drinks, baked goods, cereals, and snacks. With the processed food and beverage market estimated to reach US$6 trillion by 2021, it’s a significant growth opportunity.
  • Synthetic food colors are preferred over natural food color by manufacturing companies as they are cost-effective and have relatively better heat and moisture resistant properties. Additionally, naturally derived food colors are generally not as concentrated as synthetic food colors.
  • Artificial food colors are extensively used in dairy products such as butter and yogurt. It’s a significant growth opportunity for the food coloring market as the dairy industry is expected to grow at a CAGR of 3% by 2021.

Challenges in the synthetic food coloring market

  • Growing health awareness and lifestyle changes in developed regions has resulted in a large number of buyers adopting natural colors over synthetic food colors. As a result, food companies such as Nestlé and General Mills have drastically reduced the use of artificial flavors in their products.
  • Synthetic food coloring can sometimes change the properties of the end-product. Buyers have to incur additional costs for additions or alternatives to be implemented in the end-product formulation. Such switching costs can halt the growth of the synthetic food coloring market.
  • Petroleum products, aluminum, and coal are the primary raw material used in the production of synthetic food colors. Global demand and supply lead to fluctuations in the price of such raw materials posing problems to procurement teams in the artificial food coloring market.

For more information on the synthetic food coloring market along with supply market insights, pricing models, category management, and supplier selection criteria in SpendEdge’s upcoming report on the global synthetic food color market.

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Use of Methylene Chloride as an Extraction Solvent in Food Industry driving the demand in the methylene chloride market

Procurement of Methylene ChlorideLondon, Mar 14, 2018: Increase in use of methylene chloride as a solvent in end-use applications such as in the production of pharmaceutical products, fine chemicals, and polymers, and as an extraction solvent in the food and beverage industry is driving the growth in the global methylene chloride market.

SpendEdge’s latest procurement research report on the global methylene chloride market offers an in-depth assessment of the crucial factors influencing the supply market, strategic procurement and sourcing decisions, pricing models, and procurement best practices. The report, a part of the chemicals portfolio, also offers detailed insights into the supply chain management, key market developments, and demand-supply shifts to help sourcing and procurement experts make smart procurement decisions.

“The demand for methylene chloride in APAC is high due to economic growth in countries such as China and India, which has led to increase in infrastructural development. This is leading to rise in demand for methylene chloride among end-user industries such as paints and coatings and adhesives.” – Tridib Bora, chemicals procurement research specialist at SpendEdge.

The prices of methylene chloride are highly volatile as it depends on factors such as demand and supply of methylene chloride and the prices of raw materials. As a result, buyers in this market are facing procurement challenges to estimate the prices of methylene chloride for a contract period and in estimating the overall procurement budgets.

Need more insights on this report?

Request Free SampleThis procurement report on the methylene chloride market offers insights on:

  • Supply markets, growth drivers, trends, and imminent restraints
  • Key suppliers and assessment of their capabilities
  • Procurement best practices
  • Negotiation strategies and cost-saving opportunities
  • Pricing models and category innovations
  • For a comprehensive, detailed list, view our full report

Get unlimited access to all our reports. Get access to our reports to gain insights, platform ready-to-use procurement research reports, latest supplier news, innovation landscape, markets insights, supplier tracking, and much more at the click of a button. Request a free demo now


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Growing Demand from Automobile Industry Driving the Demand for Electric Motors

Electric Motors ProcurementLondon, Mar 12, 2018: There has been an increase in demand for electric motors from the automobile industry due to increased production of electric vehicles. Electric vehicles do not pollute the environment and do not require fuel. Hence, their demand is rising, which is driving the growth of the global electric motors market.

SpendEdge’s latest procurement research report on the global electric motors market offers an in-depth assessment of the crucial factors influencing the supply market, strategic procurement and sourcing decisions, pricing models, and procurement best practices. The report is a part of the heavy industry, also offers detailed insights into the key market developments, supply chain management, and demand-supply shifts to help sourcing and procurement experts make smart procurement decisions.

“The automobile industry being one of the major end-users of electric motors holds nearly 30%–35% of the global electric motors market. In the automobile industry, electric vehicles, which include hybrid vehicles, are the major application for electric motors. The growth of the automobile industry is directly contributing to the market growth of the electric motors market.” – Bhuvaneshwari Udayakumar, heavy industry expert at SpendEdge.

Buyers often encounter difficulty in assessing the suppliers based on the likely maintenance cost during the on-boarding of suppliers. During the analysis of the LCC of electric motors, maintenance cost is an important factor considered in the evaluation process. However, during real-time operation, due to fluctuations of parameters such as load and current in the operating environment that alter the power and performance of electric motors, the life of electric motors is affected. As a result, buyers face procurement challenge in assessing expected maintenance cost during procurement.

Need more insights on this report?

Request Free SampleThis procurement report on the electric motors market offers insights on:

  • Supply markets, growth drivers, trends, and imminent restraints
  • Key suppliers and assessment of their capabilities
  • Procurement best practices
  • Negotiation strategies and cost-saving opportunities
  • Pricing models and category innovations
  • For a comprehensive, detailed list, view our full report

Get unlimited access to all our reports. Get access to our reports to gain insights, platform ready-to-use procurement research reports, latest supplier news, innovation landscape, markets insights, supplier tracking, and much more at the click of a button. Request a free demo now


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