Sourcing Office Equipment
Office equipment accounts for a reasonable proportion of indirect procurement spend – with some estimates as high as £1,000 per person, per year. Despite that, very few organisations have it under control – which is surprising, because it’s ripe for optimisation, which lead to cost saving and efficiencies. In fact, it’s relatively straightforward…
Leverage economies of scale
The chances are, the majority of the stock you buy for your office is a repeat order – pens, pencil, notepads etc. Rather than buying these ad-hoc or as needed, you should buy your most frequently bough items in bulk to take advantage of economies of scale and the associated cost savings you can make by doing so. It’s also worth remembering that pricing in this category in particular is driven by volume, so there will always be room to negotiate. If buying in bulk creates a storage issue, then consider using a vendor or service that will store and deliver your stock from their premises
Take advantage of pack building services
If you’re buying for multiple sites then using a pack building service to distribute your office supplies can help to save money and time on delivery, and still allow you take advantage of economies of scale. Most sites will have differing needs. Bulk ordering to a central site, before using a bespoke pack building service allows you to split standard pack sizes and to create customisable product packs per the requirements of each site. Again, this allows you to leverage economies of scale, and also to consolidate shipping and logistics costs.
Office equipment is a major area of rogue spend, a category of spend that accounts for as much as 29% of indirect spend (according to the Hackett Group). It’s a problem for a number of reasons. If you have a contract in place to supply office equipment it will have discounts built into it based on volume. If your team buys off contract with another vendor that can lead to less volume with the contracted supplier and lost cost savings. For high volume categories like office supplies, consider setting user or branch level controls that restrict purchases to a preferred supplier That way you can manage rogue spend and get the best from your contracts.
Monitor your inventory
By implementing technology tools you can monitor inventory levels, gain visibility over your supply chain and also forecast spend. For high volume categories like office equipment, this extra layer of visibility can help to bypass bottlenecks, gain price consistency and mitigate risk by forecasting supply shortages.
A well stocked office goes a long way to helping the company deliver, and a well-managed office-equipment category goes a long way to optimising indirect procurement spend. Getting a handle on it shouldn’t be tricky as long you stick to these basics.
- Save money by leveraging economies of scale
- Reduce order time and delivery volumes by use pack building services
- Manage rogue spend and the get the best from contracts by setting controls
- Keep an eye on your stock – it’ll help you be more strategic and efficient in the long run
For more advice and information on sourcing office equipment, visit itelgroup.co.uk