Tag: procurement efficiency

IR27

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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IR38

What Are the Steps Involved in Procurement Process?

Every procurement process is more complex than it might seem to be. Since procurement is an umbrella term that includes several core business functions, it should be considered a core part of any organization’s corporate strategy. Strategic procurement is an organization-wide process. Moreover, having a good procurement process in place will ensure that companies pay the best price for goods or services, save time by choosing the most reputable vendors, and minimize order delays and mistakes. Each organization varies from one another in terms of their operations and requirements.  Some organizations require a formal process to suit their complex environment, which is often the case in government or education sectors. In those industries, vendors must comply with strict guidelines. Others, like enterprise businesses, require a few key steps to manage budgets more effectively. Here are the steps involved in a successful procurement cycle:Request Demo_SE

Step #1: Need recognition

Every procurement process begins when a business feels the need for a good or a service.  These goods or services can either be internal – any materials required to run the business, or external – materials that the business will eventually sell. At this stage, businesses are also expected to set a budget within which they expect to procure the goods or services. This will help companies to ensure that they don’t end up paying too much and overshooting their budget.

Step #2: Vendor selection

This is one of the most crucial steps in the procurement cycle. Companies must identify different vendors who can cater to their requirements. A comprehensive comparison should be undertaken to understand which vendor provides the best value and quality for your goods or services. It’s important to find vendors who not only deliver a high-quality product for a competitive price but also has a strong reputation.

Step #3: Internal approval

The next stage in the procurement process involves getting the thumbs up from the internal department that controls finances to purchase your goods or services. This includes creating a purchase requisition document and submitting it to that department.

procurement process

Step #4: Purchase order

The purchase order is used to buy materials between a buyer and seller. It specifically defines the price, specifications, and terms and conditions of the product or service and any additional obligations.

Step #5: Order details and invoice

This is the stage of the procurement process where the vendor sends an invoice to the purchaser which describes exactly what the order includes. The invoice confirms the sale and reaffirms exactly when the payment is due. When the purchaser receives the order, they typically have a limited amount of time to notify the vendor of any issues with the good or service. At this point, purchase orders, order receipts, and vendor invoices – are aligned and reconciled, highlighting any discrepancies to ensure that what you are being charged matches what you have received.

Step #6: Payment

Once the order is received, the next step in the procurement process is for the purchaser to make payments to the vendor within the timeframe that has been agreed upon. Usually, payment is made in the form of cash, check, bank transfers, credit letters or other types of electronic transfers.

Step #7: Maintain a Record

The final stage in the procurement cycle is essential to ensure all-around bookkeeping and audit purposes. These include purchase records to verify tax information and purchase orders to confirm warranty information. Purchase records reference future purchases as well.


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IR30

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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Adoption of Automation Driving the Demand in the Stackers Market

SpendEdge Procurement Market Intelligence - StackersLondon, Mar 23, 2018: The growth of port infrastructure and rise in the adoption of automation across end-user industries, such as e-commerce, packaging, logistics and warehousing, food and beverage, and mining, have driven the demand for stackers that are used for picking and moving products at operational facilities of end-users. This, in turn, is driving the growth of the global stackers market.

SpendEdge’s latest procurement research report on the global stackers 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 facility management, 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 increased use of reach stackers at ports to move goods from the ship to the port facilities is contributing to the growth of the stacker market. Stackers help in efficient handling of goods with minimal damage during transportation from ship-to-shore.” – Tridib Bora, facility management expert at SpendEdge.

Buyers generally prefer to procure stackers that have high reliability to minimize unexpected breakdowns. However, buyers find it difficult to analyze and compare highly reliable stackers due to high customization and the availability of a large variety of models. As a result, procurement teams in this market are facing difficulty in analyzing the reliability of stackers.

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This procurement report on the glass stackers 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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Top Transformer Manufacturers Powering the World’s Energy Needs

A transformer is an electrical device that transfers electrical energy between two or more circuits by using the principle of electromagnetic induction. It is an extremely important equipment which distributes power efficiently across the electric grid. In modern power stations, power is generated at a low-voltage and step-up transformers are used to increase the voltage to transmit power over long distances with minimal loss. Then, another step-down transformer is used to reduce the voltage before it is distributed to homes and industries. Power transformers, distribution transformers, measurement transformers, and protection transformers are the major types of transformers based on usage. The rapid expansion of power generation and distribution projects in the APAC region is expected to drive the demand in the global transformers market. Transformer manufacturers are supplying their products to utility companies who are replacing their old and aging transformers with modern ones. The market looks lucrative for transformer manufacturers (Source: A recent procurement intelligence report from SpendEdge, which estimates the market to grow at an impressive annual CAGR of 8.5%).Request Free Sample

Top Transformer Manufacturers

Siemens

Siemens is a German multinational firm and one of the largest industrial manufacturing firms in Europe. Industries served by Siemens include aerospace, automotive, chemical, mining, oil and gas, food and beverage, cranes, cement, and pharmaceutical. Amongst the largest transformer manufacturers, the company offers products for all output and voltages. The company designs its product with environmental sustainability and efficiency in mind and also comply with EU norms and guidelines. Power transformers, reactors, phase shifting transformers, HVDC transformers, distribution transformers, and tractional transformers are some of the products offered by the company.

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Increasing Consumption of Alcoholic Beverages Driving the Demand for Glass Bottles and Containers

SpendEdge Procurement Market Intelligence InfographicsLondon, Feb 27, 2018: Increasing consumption of alcoholic beverages such as wine and beer across the globe, especially in regions such as APAC and South America, consequently contributes to the demand for glass bottles and containers for packaging, as they facilitate high designing capabilities for the buyers. Additionally, the rise in demand from the cosmetics and perfumes industry is also driving the demand in the global glass bottles and containers market.

SpendEdge’s latest procurement research report on the global glass bottles and containers 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 packaging and labeling, 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.

“Glass bottles and containers are one the most preferred materials for packaging across end-user industries as they are 100% recyclable. The growing stringency of regulations in packaging from regulatory bodies has shifted the focus of buyers towards glass bottles and containers as a packaging option.” – Bhuvaneshwari Udayakumar, packaging and labeling expert at SpendEdge.

Buyers in the industry face challenges with standardization of products in terms of quality across their production hubs due to variance in raw materials and cullet quality and testing capability of the personnel. As a result, buyers face procurement challenge in labeling and packaging of substances. Also, improper quality of bottles and containers may affect the shelf life of product stored and lead to losses for buyers.

Need more insights on this report?

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This procurement report on the glass bottles and containers 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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Government Initiatives to Replace Ageing Transformers Increasing the Transformers Sales Across the World

Transformers MarketLondon, Feb 20, 2018: Rapid economic growth in APAC, especially in countries such as India, Indonesia, and China, has resulted in investments by governments and private organizations in many power generation and distribution projects. This has led to a rise in demand for both power and distribution transformers. Also, electric utility companies across the globe are increasingly replacing their old and aging transformers with modern ones increasing the sales in the global transformers market.

SpendEdge’s latest procurement research report on the global transformers 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 utilities, 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.

 “Governments across the globe are taking initiatives to improve the efficiency of transmission and distribution of electricity. Hence, they are replacing aging transformers with new ones. This is because, over the years, due to wear and tear of coil windings, the performance of transformers reduces and the energy loss during transmission increases. As a result, sales in the transformers market across the world has been on the rise.” – A Kowshik, facility management expert at SpendEdge.

Buyers face issues in evaluating the performance and reliability of transformers due to the lack of in-house expertise and technical know-how related to power generation systems. This may lead to the procurement of inappropriate transformers, which can increase buyers’ cost of ownership. As a result, buyers face procurement difficulty in hiring technical experts that have complete knowledge of electrical devices and equipment who can assist in selecting transformers.

Need more insights on this report?

Request Free Sample 

This procurement report on the transformers 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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The Complexities in the Procurement of Butane Gas

Butane, an organic compound of hydrogen and carbon, remains in a gas form at room temperature and atmospheric pressure. Butane gas has a wide range of application but is mainly used as the primary gas compound in LPG cylinders. The increasing applications of LPG cylinders in cooking equipment, heating appliances, and vehicles are contributing to the growth of butane gas market.  Apart from its use in LPG cylinders, butane is used as a chemical feedstock to manufacture ethylene and butadiene, a key ingredient of synthetic rubber. The recent report from SpendEdge attributes high level of adoption of LPG as a domestic fuel in APAC and Africa as a major growth driver. Although there seem to be lucrative growth prospects in the butane gas market, butane gas manufacturers are facing various logistics and supply chain issues, including difficulty in the procurement of butane gas.Request Free Sample

Major Procurement Pain Points in the Butane Gas Market

Complexity in Monitoring Suppliers’ Compliance with Labor Laws

The buyers need to constantly monitor supplier’s compliance with labor laws and international standards regarding workplace conditions, as violations of such laws exhibit negligence in supplier evaluations from the buyer’s part. Such negligence could impose hefty fines and penalties to the buyer. Consequently, buyers will have to bear additional procurement costs to conduct periodic audits of supplier’s facilities to ensure compliance with labor laws. Major butane suppliers usually hire EHS consultants to carry out such audits.

Fluctuations in Butane Prices

The variation in demand and supply of butane alongside volatility in crude oil prices are contributing to the price fluctuation of butane gas. The buyers are facing difficulty in estimating their procurement budgets as the prices for butane differ in summer and winter season. The price difference is because of the changing nature of demand from automotive fuel suppliers as they change between summer-grade gasoline and winter-grade gasoline. Butane manufacturers usually include a clause for renegotiation in SLAs in case of price fluctuations to offset the changes.

Sourcing Limitations due to Import Duties

The government of several countries including Nigeria, China, and India levy import duties on butane in order to promote the consumption of domestically produced products. However, due to demand and supply imbalances or inefficiencies across the value chain of domestic players, the prices for butane usually falls on the higher side. For instance, although the price of butane is high in Nigeria due to process inefficiencies and inflation, they cannot import butane from other regions due to exorbitantly high import duties. To tackle with this procurement challenge, buyers evaluate countries where bilateral treaties are in place, which allows them to import the product by paying lower duties.

 

Read more about the top procurement challenges in the butane gas market along with sourcing strategy, cost modeling, strategic purchasing, pricing trends, and procurement best practices in SpendEdge’s upcoming report on the global butane market.

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Innovations in Procurement Process that can Reduce Spends for Banking Services

The banking sector is still affected by the great depression witnessed a decade back. Numerous procurement cost including real estate, ATM maintenance, transaction and card processing services, collections, risk management, security services, and in-branch marketing are burdening the banks bringing down their profitability. To remain competitive and sustain in the market banks and financial institutions are looking for various cost containment strategies. The banking sector is looking for innovative ways in their procurement process to control the procurement costs.

Request Free SampleSupplier Cost BreakupSource: SpendEdge Procurement Research Report – Global Banking Services Category

Pooling Resources for Cost Containment

The banks and financial service providers have come up with innovative solutions to pooling of resources for a particular line of business, allocating a dedicated entity to manage the processing. Pooling of resources to share infrastructure and operational costs across the organizations can lead to massive cost savings and at the same time increase the investment efficiency by making capital-intensive projects more viable.

Vendor Consolidation or Supplier Rationalization

Vendor consolidation is one of the procurement strategy used by banking and financial services industry to achieve cost savings. Banks look forward to reducing the number vendors across geographies and business units to focus on selecting preferred vendor per spend category. Implementing such vendor partnerships allow banks to increase their operational efficiency and productivity and thereby save valuable time and money. Additionally, such procurement cost reduction strategies eliminate the need for lengthy training procedures for the staff and also ensure compliance with the procurement process.

Investment in Technology

The financial industry has always been resource intensive and over-reliant on human expertise. Although the majority of the banks invest heavily in ERP systems, the usage of technology is still limited mostly due to lack of people who understand such technology. Blockchain technology is the next big thing in the financial services industry which can eliminate lengthy transaction processes along with costly third-party verification. Such technologies can rapidly increase the efficiency of the procurement process within the financial industry.

Adoption Of Public Cloud Services for Digital Banking

Banking service providers are turning towards applications and storage space available in the public cloud eliminating the need to invest in dedicated hardware and software resources. Opting for various engagement models such as SaaS, PaaS, and IaaS, banks can digitize their services without having to maintain data centers.

Read more about the procurement process in the banking services market along with pricing strategies, supply market landscape, pricing trends, negotiation strategies, procurement cost reduction strategies, and procurement insights in SpendEdge’s upcoming report on the global banking services market.

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IR33

End of an Era for TV Advertising? A Procurement View

As you make your way through the blog, you would have already got past many advertising on your desktop or mobile device right from website ads, Google paid search to promotional e-mails. You may struggle to remember the last time you saw a TV commercial or turned the TV on for that matter. If TV advertising is dead then why are TV advertising rates still high with brands willing to pay millions of dollars just to get their spot there? Although the market share of traditional media like radio and newspaper is dwindling, TV advertising is still unshaken, which can be justified by its steady growth rate with a CAGR of over 4% (SpendEdge Report: Global TV Advertising Market – Procurement Market Intelligence Report 2017-2021).

Request Free SampleGrowth Constraints of TV Advertising Market
Brands on an average spend 8-10% of their marketing budget for the TV medium. The high cost of purchasing TV advertisement is driving the brand managers to evaluate alternate advertising channels. Additionally, it is difficult to determine the ROI of TV ad campaigns making the companies skeptical about massive investments in this medium. The emergence of the alternate channel along with growing use of mobile devices could hinder the growth of this market.

Shift from TV to Online Platform?
It has been observed that brands are reallocating their TV advertising budgets to online platforms by analyzing the recent trends. As per the report, the global digital advertisement spend had surpassed global TV advertisement spend in 2016. However, TV advertising agencies can benefit from this trend as broadcasting agencies will lower the TV advertising costs to attract brands and sustain in the market. Additionally, the shift towards digital medium is moderate in APAC and MEA regions due to lack of penetration from online platforms.

Is the TV Advertising Market Growing?
The growth prospect for TV medium may look bleak, but certain factors are driving the growth of this market. The most important one being increasing penetration of DTH across emerging markets. DTH allows for increased transparency and broadcasts content based on personalization and customer recommendation to ensure targeted reach. The most exciting growth prospects come from online businesses who are opting for TV medium to reach the masses and thus contributing around US$860-US$865 on TV mediums in the US.

Read more about the procurement view of the TV advertising market along with supply market landscape, pricing strategies, pricing trends, negotiation strategies, cost modeling, and procurement insights in SpendEdge’s upcoming report on the global TV advertising market.

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