Tag: supplier evaluation

supplier evaluation

Why Developing Supplier Evaluation Methods is a Critical Business Competency?

The evaluation and selection of suppliers carry utmost importance in the current scenario of global purchasing. It helps companies in structuring the supplier base and improving the efficiency of the supply chain. Especially organizations in the manufacturing sector need to have a supplier selection and evaluation model in place in order to gain the utmost value from their suppliers. However, evaluating suppliers can be challenging, costly, inefficient, and inconsistent task for companies. The approaches used by companies can prove to be inadequate and inefficient when it companies to supplier measurement. Through this blog, we have tried to highlight the relevance of the supplier evaluation process and best practices that can address challenges such as how to :

  • Identify hidden cost drivers in the business.
  • Figure out approaches and metrics for supplier evaluation.
  • Determine actionable supplier opportunities for improvement.

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IR18

Supplier Profiling: A Case Study on How Performance Assessment Helped a Car Manufacturer to Reduce Sourcing Costs By 19%

The Business Problem 

The client, a leading car manufacturing company in the US, was struggling amid a tumultuous economy. Despite the US being the largest automobile market, their profit margins were shrinking rapidly, and their stock price had taken a tumble. This compelled the client to take a step back and conduct a comprehensive supplier performance assessment as a major chunk of their total production costs were coming from suppliers due to the implementation of a poor sourcing process. They also realized that conducting a comprehensive performance assessment of suppliers was crucial for the company to decrease costs, improve quality, and integrate new technologies.

Is poor planning increasing production costs for your products? Well, not anymore! Request a free proposal below and know how our performance assessment solutions can improve your supplier profiling process.

Solutions Offered

To cater to the car manufacturer’s predicaments and help them reduce operational costs, the experts at SpendEdge tailored a comprehensive two-step research methodology. This extensive research methodology included primary and secondary research coupled with interviews and discussions with industry stakeholders to identify the optimal process to profile suppliers.

In a span of 12-weeks, the performance assessment solution started showing promising results. Their supplier profiling process improved drastically, and the car manufacturer was able to achieve significant cost savings since they were now able to meet all their performance goals. The company was also successful in removing wasteful costs and activities such as extra freight charges, overtime, safety stocks, obsolete inventory, and buying from multiple sources caused by supplier glitches. Moreover, with the aid of SpendEdge’s performance assessment solution, the client was able to better understand supplier performance and industry best practices, which had a subsequent impact on the costs and supplier engagement process.

Interested in conducting a comprehensive performance assessment of suppliers? Request a free demo and know how our experts can help you in understanding supplier performance industry best practices.

Key Findings

The performance assessment solution helped the client to enhance their supplier relationship and design a program to recognize the high performing suppliers. This reduced their sourcing costs by 19% and helped them mitigate financial risks. The supplier performance assessment also helped address factors such as quality, delivery, and cost management apart from underlying qualitative factors.

Why is Supplier Performance Assessment Critical?

With the increasing number of offshore suppliers, supplier performance assessment becomes critical for companies looking to overcome a variety of supply chain challenges. Companies must conduct performance assessment to gain better visibility into their suppliers’ performance, remove hidden cost drivers, and reduce risks by lowering order cycle times and inventory. Also, the supplier performance assessment process helps companies to achieve at least 20% improvement in supplier performance metrics such as on-time delivery, quality, and cost.


Supplier evaluation is crucial for improving the operational performance of companies. Contact our offices below and know how we can help you increase operational efficiency.







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Rise in Labor Cost Driving the Demand for Automation and Instrumentation Solutions

SpendEdge Procurement Market Intelligence InfographicsLondon, Apr 26, 2018: Growing demand for incorporating automation and instrumentation systems and solutions within industries such as oil and gas, metals and mining, pharmaceutical, and paper and pulp to enhance productivity, reduce production cost, and minimize labor cost is driving the demand in this market. Additionally, lack of availability of skilled labor and rise in labor cost encourage buyers to opt for automation and instrumentation solutions.

SpendEdge’s latest procurement research report on the global automation and instrumentation 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 information technology, 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.

“Automation and instrumentation enable businesses to improve productivity by reducing errors and enhancing quality and speed of activities. As per observations, it is noted that automation of activities can increase productivity growth globally from approximately 0.6%-0.8% to 1.3%-1.5% annually.” – Bhuvaneshwari Udayakumar, information technology expert at SpendEdge.

Business process re-engineering enables buyers to estimate the cost of restructuring and the ability of the existing infrastructure to integrate with automated systems and software. However, buyers find it difficult to understand organization’s capabilities in terms of analyzing organization’s structure, culture, and existing IT resources. Furthermore, issues in comprehending the organizational culture may lead to disruption in routine work due to the implementation of automation and instrumentation.

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This procurement report on the glass automation and instrumentation 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

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Growth of the Frozen Food Industry Driving the Demand for Myristic Acid

SpendEdge Procurement Market Intelligence I- Myristic AcidLondon, Apr 11, 2018: There is an increase in the overall global spending on processed foods, personal care, and cosmetic products due to economic growth. As these are the major end-users of myristic acid, and it has led to the growth of the global myristic acid market. Additionally, the increase in demand for natural fatty acids in food products from end-consumers ensures that they focus on production of food, which contains the necessary amount of natural fatty acid, such as myristic acid.

SpendEdge’s latest procurement research report on the global myristic acid 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, 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.

“Myristic acid acts as a preservative within the frozen food industry due to its food quality retention properties. The frozen food industry is expected to grow at a CAGR of 3.6% by 2019, and thereby increase the demand for myristic acid” – A. Kowshik, chemicals expert at SpendEdge.

The raw materials market for myristic acid experiences seasonal volatility due to natural calamities such as hurricanes, tsunamis, floods, or drought. Also, the production of nutmeg, coconut oil, palm oil, and palm kernel oil, which are major raw materials of myristic acid require a tropical climate. Therefore, such seasonal weather changes affect tree plantation and interrupt the supply of myristic acid in adequate amounts causing a major procurement problem.

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Request Free SampleThis procurement report on the glass myristic acid 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

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Growing Transmission and Distribution Network Driving the Demand for High Voltage Capacitors

SpendEdge Procurement Market Intelligence InfographicsLondon, May 16, 2018: Factors such as rapid industrial development across emerging markets and growing transmission and distribution network worldwide have subsequently increased the demand for high voltage capacitors. In terms of applications, high voltage capacitor is majorly used in bulk power transmission as it helps to reduce transmission losses. The adoption and implementation of a technological upgrade in the power market has enhanced the efficiency of high voltage capacitors and improved the end-user experience, which drives the market growth

SpendEdge’s latest procurement research report on the global high voltage capacitor 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 electrical component, 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.

“High voltage capacitors are used in diverse end-user industries such as power supplies, power transmission and distribution, drive systems and inverters, motors, oil and gas electronics, and medical electronics. Further, high voltage capacitor demand is relatively strong in smartphones, tablet, automotive electronics, and computers, which is anticipated to drive the market growth.” – Tridib Bora, electrical components expert at SpendEdge.

Reliability of high voltage capacitor is important to ensure their safe operation. Buyers conduct several tests to check the reliability of capacitors. Therefore, buyers/suppliers must check various documents published by international and national bodies such as International Electrotechnical Commission as they enumerate guidelines regarding the reliability of capacitors.

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This procurement report on the high voltage capacitor 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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IR34

Customs Brokerage Market – A 360° Market Overview

Customs brokerage firms make the international trade possible by facilitating the shipment and delivery of goods across international borders. The agency has to take care of shipments which occur in a sheer volume across international borders every single day. Each country has a different set of rules and regulations regarding customs, import, and export. Additionally, laws and regulations regarding customs are changing constantly, making it impossible for a normal person to do business across international borders. The customs broker facilitates this transaction as they are responsible for knowing all the rules and regulations. The broker will facilitate and streamline the shipping process for the individual or the organization.

Request Free SampleMarket growth

The customs brokerage market is on track for a steady growth of 8.5% per annum. Buyers, especially in North America and Europe, are collaborating with regional suppliers for strategic sourcing and supply chain management. Collaboration with regional suppliers has enabled buyers to reduce their TCO for customs brokerage and helped them realize cost savings between 5% and 7%. Although global firms can offer a wide range of customs brokerage services, it is their inability to offer assured savings that is swinging the market in favor of regional suppliers.

Market pricing

Although the demand for customs brokerage services is rapidly on the rise, the prices are only set to marginally increase over time. The market for such services is highly fragmented, resulting in high level of competition which is expected to keep the prices stable. The growth of the manufacturing industry has alerted service providers to offer their services for increased global trade. This will bring in added revenues to such service providers.

Pricing model

The brokers can charge their clients either an hourly rate, a fixed fee, or fee-based on services provided. However, both buyers and sellers are hesitant to deal on a fixed fee. They prefer to deal on an hourly rate basis, which bills customers on the basis of time involved for the advice and solutions on processing the shipment. It also provides the buyer with finer control over the expenses associated with customs clearance.

Cost-saving levers

Reducing the total lifecycle or ownership cost is one of the most effective cost-saving levers in this market. Reducing the TCO associated with customs clearance process by focusing on R&D to come up with technological innovations can help suppliers increase their process efficiencies, reduce overall costs, achieve increased economies of scale, and transfer these savings to buyers.

Market innovation

Suppliers for long had been working on technology to detect defects in shipment. These technologies include smart seals and trafficking sensors that alert suppliers in case if a seal of a cargo item is tampered and help to locate the shipment before it reaches a customs official. A supplier based in California is utilizing a smartphone app that connects shippers and carriers. The app allows containers from multiple shippers to be grouped at the ports before alerting different carriers on when containers are available and where they should be taken.

 

Read more about the market outlook of the customs brokerage market along with procurement best practices, pricing insights, supply market insights, and market innovations in SpendEdge’s upcoming report on the global customs brokerage market.

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IR27

Growth of Consumer Electronics and Automobile Industry Driving the Demand for Low Voltage Capacitors

SpendEdge Procurement Market Intelligence InfographicsLondon, May 14, 2018: Telecommunications, consumer electronics, and automobile electronics segments will contribute 40%-53% of the rise in incremental spend in the low voltage capacitor market. This incremental spend is primarily driven by the demand from the APAC countries, especially India and China. Due to such incremental spends, the APAC region is expected to dominate the market by 2025.

SpendEdge’s latest procurement research report on the global low voltage capacitor 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 electrical component, 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.

“Proximity to electronic component manufacturing facilities and the subsequent supply chain related cost savings and huge market potential for the growth of end-user industries such as smartphones are compelling buyers in North America and Europe to establish manufacturing facilities in these regions. This is directly driving the growth of this market.” – Tridib Bora, electrical components expert at SpendEdge.

Buyers can enter into a strategic research partnership with suppliers for enhancing end-product functionalities and quality. In such research partnerships, suppliers agree to supply the newly developed product at a lower price to the buyers, while the same products are sold at a higher price in the market. This way, entering into strategic research partnerships with suppliers for developing products that will meet specific requirements is one of the best procurement practice.

Need more insights on this report?

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This procurement report on the low voltage capacitor 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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IR3

An In-depth Insight into the Global Pesticides Market

The world population has been growing at a rapid rate. To cater to the demands of the population, the food supply in the world has to grow proportionally. The problem is that the arable land is limited, so people have to rely on efficiency gains to meet the world’s food demand. Insects, weeds, and pests destroy a majority of the crops. Pesticides are extensively used to control the spoilage of crops against pests. Pesticides are used to preserve the crops and food from harmful pests during the production, processing, storage, or transport process. The rising demand for weed management has led to the growth of the herbicides segment, which is the largest segment in the global pesticides market. Herbicides are extensively used to control weed growth in crops.

Request Free SampleLargest pesticide market

The APAC region is the largest market for pesticides, accounting for a market share of about 49%. The market is expected to grow at a CAGR of about 7% in the region. The consumption in this region can be attributed to the use of pesticides in regions such as India, China, and Japan. These regions require a high amount of pesticides as it is the leading producer of rice, wheat, and vegetables. The regional market is expected to reach nearly $23 billion by 2022. Additionally, continuously evolving technology and advances in the agriculture industry are encouraging farmers to engage in effective pest management, which, in turn, has resulted in the increased use of pesticides.

Global supply

The supply market for pesticides is controlled by few major players such as BASF, Bayer, DowDuPont, and Syngenta. Smaller players are also making an impact in this market by increasing their production capacities in North America and Africa. Suppliers are using proprietary manufacturing technologies to enhance the quality of pesticides and increase automation of production processes. Leading suppliers are also focusing on the adoption of technologies such as process analyzers to enhance quality control and improve the performance of pesticides.

Top 3 exporters of pesticides

  • Germany: US$4 billion (13% of global exports)
  • China: US$3.7 billion (12% of global exports)
  • The US: US$3.4 billion (11.1% of global exports)

Market developments

One of the most fascinating trends seen in this market is the use of GM technology to provide disease or insect resistance in crops. It can either work by making the plant immune to certain pesticides so it can be used in huge amounts without the harmful side effects or be resistant to the pests itself. However, the GM technology is heavily regulated, and suppliers using DNA technology are legally required to assure the safety and quality of the product before it enters the food supply.

Market challenges

The environmental impact of pesticides is one of the biggest talking points in the world right now. Some pesticides have been proven to be harmful to the humans, and use of such chemicals can lead to the pollution of freshwater, which releases carcinogens and other poison into the ecosystem. As a result, the use of pesticides will be less in the future. Additionally, people are refraining from using foods grown using pesticides and opting for organic food.

Procurement challenges

There has been significant volatility in the prices of raw material in the pesticides industry. The price volatility poses challenges for organizations in predicting their procurement budgets. Lack of knowledge on price fluctuations can be disadvantageous for buyers as it results in the buyer paying more than the market price due to contractual obligations. However, to save against such price fluctuations, buyers can implement a contract clause that provides an upper limit on pesticide prices.

Read more about the supply market landscape in the pesticides market along with supply market insights, procurement challenges, category management, and pricing models in SpendEdge’s upcoming report on the global pesticides market.

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A Supply Market View into BioPharma Cold Chain Packaging

Biopharma products such as blood components, vaccines, tissues, cells, stem cells, and infectious substances, require safe packaging to endure cold temperatures of the storage containers used to transport them. Safe packaging ensures the safety, sterility, and viability of the biopharma products and specimen inside. Metal, glass, or plastic can be used for biopharma packaging. The growth of the pharmaceutical industry is expected to drive the spending on pharma packaging. The SpendEdge procurement market intelligence report on global biopharma cold chain packaging market estimates the R&D expenditure of the pharmaceutical industry to increase by 3% on an average every year. For the purpose of such research, drugs and clinical supplies require stable cold temperatures, which, in turn, drives the demand for biopharma cold chain logistics.

Request Free SampleLargest market for biopharma packaging

North America is the largest market in terms of consumption of pharma packaging, accounting for a market share of about 30% in 2017. Also, the market is expected to grow at a CAGR of 8.32% during the forecast period. This is mainly because all the major biopharma cold chain packaging companies are present in this region. The region also consists of the largest CROs and pharmaceutical markets across the globe, which are the major end-user industries for the category. Additionally, the market growth has been spurred due to an increase in government R&D spending for drug discovery and therapeutics.

Fastest growing market

In 2017, APAC accounted for 22% of the global market and is estimated to be the fastest growing biopharma cold chain packaging market. Experts have estimated that the market would grow at a CAGR of 10.2% by 2022. This rapid growth can be attributed to the preference for outsourcing bio pharma cold chain logistics activities in this region. This drastically reduces the cost of raw materials in this region, further reducing the cost.

The supply market overview

The supply market for pharma packaging is highly consolidated with major suppliers such as UPS, Allergan, BD, and Amcor dominating the market. Additionally, they are looking to increase their global presence by outsourcing their biopharma cold chain logistics function to offshore regions. Apart from cost containment, they are also looking to improve packaging quality by incorporating latest technology such as using temperature data loggers with wireless communication systems to enable effective monitoring and maintain storage temperatures. To increase their customer base and global coverage, major suppliers from North America and Europe have been increasingly resorting to building offshore facilities in these regions. Suppliers are also focusing on outsourcing their packaging requirements to regional contract packaging organizations.

Regulatory hurdles

Since the bio pharma packaging market deals with delicate products with health implications, companies operating in this market need to have a comprehensive understanding of regulatory hurdles. To receive marketing permits and successfully release products in the market, the packaging solutions are required to undergo initial tests and obtain specific quality certifications from regulatory agencies regarding their safety, performance, and efficiency. The FDA also states that it is the manufacturer’s responsibility to prove the packaging material’s safety and to get approvals before using it for any pharmaceutical product.

Prominent market player

UPS is one of the global leaders in logistics and offers a broad range of solutions, including packaging and freight. The company also provides biopharma cold chain logistics solutions for pharmaceutical companies. Apart from UPS, DowDuPont, Allergan, and AMCOR are also some of the prominent service providers in the pharma packaging market.

Read more about the procurement overview of the biopharma cold chain packaging market along with procurement challenges, supply market insights, pricing models, and regulatory issues in SpendEdge’s upcoming report on the global biopharma cold chain packaging market.

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New Uses of Gelatin Driving the Growth in the Global Pharmaceutical Gelatin Market

SpendEdge Procurement Market Intelligence - Pharmaceutical GelatinLondon, Apr 09, 2018: There has been an increase in demand recently for marine gelatins such as fish gelatin, especially in regions where buyers demand non-bovine sourced gelatins, and in the countries where halal and kosher certifications must be followed. In addition to that, governmental support worldwide in the form of investment and regulatory approval for suppliers in emerging markets such as India has led to the growth of this category.

SpendEdge’s latest procurement research report on the global pharmaceutical gelatin 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 pharma and healthcare, 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.

“In the next two years, the overall consumption of pharmaceutical grade gelatin is expected to grow by 4%-5%. Increase in use of gelatin for pharmaceutical applications can be seen globally due to the discovery of unrealized uses of gelatin including its use in treatment of wounds, therapeutics, and surgical products.” – Bhuvaneshwari Udayakumar, pharma and healthcare expert at SpendEdge.

Most players in the industry procure cattle bones as a primary raw material for gelatin, ban on cattle slaughter in certain regions may affect the entire supply chain. This hampers the supply of bones to major suppliers, which in turn results in price fluctuations of the raw material. As a result, ban on certain raw material sources resulting in price fluctuations is causing procurement challenge in the pharmaceutical gelatin market.

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Request Free SampleThis procurement report on the pharmaceutical gelatin 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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