The Procurement Pro’s Guide to Balancing Costs
How smart analytics and procurement tools can help businesses save
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Rogue Spending, or purchases made outside the approved procurement channels, is one obstacle that can lead to budget overruns and the acquisition of non-compliant goods or services. It stems from a lack of stringent controls and how easily employees can bypass procedures. To curb rogue spending, organizations require near-perfect communication around processes (which can feel like a pipe dream).
The cost-balancing hurdles standing in the way of successful procurement
Challenge #1
Rogue Spending
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Departmental Silos
Challenge #2
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Lack of Visibility
Challenge #3
It’s a veritable jungle of unexpected extra costs, miscommunication, and time wasted. The good news? It doesn’t have to be this way. There are easy-to-implement solutions for all of these cost-balancing issues.
Smart tools for balancing costs
Organizations can optimize resources, deliver cost savings, and improve procurement strategies by leveraging solutions with advanced tools and real-time data and insights. These tools also support procurement teams with supplier negotiation and responsible purchasing goals.
Spend Visibility
Guided Buying
Pay by Invoice
Amazon Business Analytics
Budget Management Suite
AI-Powered Product Recommendations
Cost balancing at work
For a glimpse into how these tools can improve margins, just look at OneDigital, an insurance, financial services, and HR consulting firm that serves more than 75,000 employers and millions of individuals globally. The team at OneDigital took a closer look at its office supply purchases to identify any significant cost-saving opportunities. In the process, the organization turned to Amazon Business tools to streamline spending, increase visibility, and take advantage of opportunities to save by switching providers — to the tune of $60,000.
OneDigital and Amazon Business deployed the below tactics to make it happen:
Guided Buying
After analysis of its office supply purchases revealed significant cost-savings potential, OneDigital imported the suggested items into its account using Guided Buying (available with a Business Prime membership), ensuring employee purchases aligned with the company’s cost-saving objectives.
Using Amazon Business, OneDigital was able to put spending caps on individuals and teams.
Spend Limits
OneDigital used Amazon Business Analytics data to enhance spending control and supplier consolidation. This insight into what the company was spending and why helped OneDigital realize cost efficiencies.
Amazon Business Analytics
“Since [the] adoption of Amazon Business, this move has proven to be a cost-effective change for our organization as well as notable increases in procurement efficiency by making it a one-stop shop for most if not all of our office needs.”
Scott Weiss
Director of Operations, OneDigital
How can you save your organization money?
test your knowledge
Lengthy approval processes for employee purchases are slowing down procurement, stressing out your employees and leading to expensive rush shipping costs. How can you eliminate this obstacle and empower your employees to make good procurement choices?
Now that you’ve learned about how smart analytics tools help organizations balance costs, it’s time to test your chops. In each of the following scenarios, choose the best way to save money.
Limit the number of employees who can make procurement purchases.
A
Use an automated tool that provides suggestions for cost-effective purchases and minimizes overspending on the wrong products.
B
Implement uniform,
easy-to-understand expectations around employee spending.
C
Ready to balance your procurement costs with Amazon Business?
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In today’s dynamic business landscape, procurement plays a critical role in determining a company’s financial health and operational efficiency. But achieving results can be an uphill battle: The path to effective procurement is fraught with cost-balancing challenges that can significantly impact an organization’s bottom line.
Departmental silos, which are all-too common across companies, can result in redundant purchases, missed opportunities for bulk discounts, and an overall lack of alignment with a company’s financial goals. As a result, many organizations experience difficulty obtaining approvals, which ultimately slows procurement.
Lack of visibility into costs further complicates these issues. Without insight into spending patterns, companies struggle to identify where to cut costs or negotiate better terms with suppliers. This opacity can result in hidden supplier fees. When teams lack visibility into opportunities to save by switching suppliers, they miss out on potential cost reductions and improved service. This can lead to higher prices and subpar performance, underscoring the importance of regularly evaluating and renegotiating supplier contracts.
Available with a Business Prime membership
This feature offers real-time spending insights, allowing users to track expenses, identify discrepancies, and reconcile transactions efficiently.
Available with a Business Prime membership
Users can manage and guide purchasing by defining transparent guardrails
for employees.
Subject to credit approval
This feature offers extended payment terms, enabling teams to free up cash flow.
This tool offers real-time data on spend and generates easy-to-understand reports.
This interface centralizes order management and helps organizations track spending.
This tool leverages machine learning to understand which products organizations need (and what they can expect to pay), then makes product recommendations in real time.
Centralize your invoice tracking with tools that automatically record each employee purchase, track your spending, and organize expenditures.
C
Implement a companywide process that requires employees to document their purchases in a
shared spreadsheet.
B
Trust each department lead to provide detailed, accurate, and recurring reports on their team’s procurement spending.
A
Tracking down invoices from different departments can be a challenge for procurement teams, and often means they don’t get a full picture of companywide spending. But chasing down purchase history from every department takes time, energy, and resources that you simply don’t have. What do you do?
Work with your current suppliers to see if they can get you better bulk discounts or provide you with better margins.
C
Manually research what else is out there — it may take a long time, but it’s important work.
B
Look into new products recommended by AI-driven product recommendations.
A
You know that you might be able to get a better deal on the products your employees source for your company. How do you research what’s available?
The correct answer is:
B
While it’s important to communicate uniform spending guidelines and it’s tempting to limit the spending power of your employees, simply implementing an automated tool that puts necessary guardrails on spending helps employees make effective procurement purchases.
Tracking your employees’ spending and keeping an organized ledger of your invoices is an important part of the procurement process, but leaning on your managers or employees to do this accounting work (or merely report on expenditures) can result in human error — or worse, burnout. Instead, Amazon Business tools make tracking spending a breeze.
C
The correct answer is:
Using Amazon’s AI-driven product recommendations provides you with the best alternate options for the products you need at any given time, without having to worry about extra time spent or whether to trust recommendations from existing suppliers.
A
The correct answer is:
Sponsor content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Insider's editorial staff is not involved in the creation of this content.
see more
Departmental Silos
Departmental silos, which are all-too common across companies, can result in redundant purchases, missed opportunities for bulk discounts, and an overall lack of alignment with a company’s financial goals. As a result, many organizations experience difficulty obtaining approvals, which ultimately slows procurement.
Challenge #2
see more
Lack of Visibility
Lack of visibility into costs further complicates these issues. Without insight into spending patterns, companies struggle to identify where to cut costs or negotiate better terms with suppliers. This opacity can result in hidden supplier fees. When teams lack visibility into opportunities to save by switching suppliers, they miss out on potential cost reductions and improved service. This can lead to higher prices and subpar performance, underscoring the importance of regularly evaluating and renegotiating supplier contracts.
Challenge #3
Guided Buying
Available with a Business Prime membership
Users can manage and guide purchasing by defining transparent guardrails
for employees.
Pay by Invoice
This feature offers extended payment terms, enabling teams to free up cash flow.
Subject to credit approval
Amazon Business Analytics
This tool offers real-time data on spend and generates easy-to-understand reports.
Budget
Management Suite
This interface centralizes order management and helps organizations track spending.
AI-Powered Product Recommendations
This tool leverages machine learning to understand which products organizations need (and what they can expect to pay), then makes product recommendations in real time.
Using Amazon Business, OneDigital was able to put spending caps on individuals and teams.
Spend Limits
OneDigital used Amazon Business Analytics data to enhance spending control and supplier consolidation. This insight into what the company was spending and why helped OneDigital realize cost efficiencies.
Amazon Business Analytics
Implement uniform, easy-to-understand expectations around employee spending.
C
Use an automated tool that provides suggestions for cost-effective purchases and minimizes overspending on the wrong products.
B
Limit the number of employees who can make procurement purchases.
A
While it’s important to communicate uniform spending guidelines and it’s tempting to limit the spending power of your employees, simply implementing an automated tool that puts necessary guardrails on spending helps employees make effective procurement purchases.
B
The correct answer is:
Centralize your invoice tracking with tools that automatically record each employee purchase, track your spending, and organize expenditures.
C
Implement a companywide process that requires employees to document their purchases in a shared spreadsheet.
B
Trust each department lead to provide detailed, accurate, and recurring reports on their team’s procurement spending.
A
Tracking down invoices from different departments can be a challenge for procurement teams, and often means they don’t get a full picture of companywide spending. But chasing down purchase history from every department takes time, energy, and resources that you simply don’t have. What do you do?
Tracking down invoices from different departments can be a challenge for procurement teams, and often means they don’t get a full picture of companywide spending. But chasing down purchase history from every department takes time, energy, and resources that you simply don’t have. What do you do?
Tracking your employees’ spending and keeping an organized ledger of your invoices is an important part of the procurement process, but leaning on your managers or employees to do this accounting work (or merely report on expenditures) can result in human error — or worse, burnout. Instead, Amazon Business tools make tracking spending
a breeze.
C
The correct answer is:
Work with your current suppliers to see if they can get you better bulk discounts or provide you with better margins.
C
Manually research what else is out there — it may take a long time, but it’s important work.
B
Look into new products recommended by AI-driven product recommendations.
A
You know that you might be able to get a better deal on the products your employees source for your company. How do you research what’s available?
Work with your current suppliers to see if they can get you better bulk discounts or provide you with better margins.
C
Manually research what else is out there — it may take a long time, but it’s important work.
B
Look into new products recommended by AI-driven product recommendations.
A
You know that you might be able to get a better deal on the products your employees source for your company. How do you research what’s available?
Using Amazon’s AI-driven product recommendations provides you with the best alternate options for the products you need at any given time, without having to worry about extra time spent or whether to trust recommendations from existing suppliers.
A
The correct answer is:
Sponsor content is produced in collaboration with advertisers by Insider Studios, the branded content team at Insider Inc. Insider's editorial staff is not involved in the creation of this content.