Evaluating Supplier Responsiveness

Supplier Responsiveness is one of the key issues that management teams are always concerned with. "How do I know many suppliers are responding in a timely manner to my requests?" Some might ask "Why should I even be concerned with this?" If you are in an outsourcing environment where you have customers relying on you to provide responses to a request in a timely manner then this becomes extremely important. Even if your customer is an internal customer likely their projects are time sensitive and if your suppliers are not submitting responses in a timely fashion then how responsive can you be to your customers? Well I often hear buyers say; "I have a pretty good idea of market price so I will just submit my own estimated cost with fudge factor built in." EEGGAADDSS!!! Your suppliers are the cost experts, they are the ones that should be supplying you with pricing not by educated guess.

The ability to measure supplier responsiveness is crucial in being able to evaluate your suppliers. Tools should be available to tell you how long it takes a supplier, from the time the request is submitted to the time the request is responded too. On a per request basis and overall for a time period. You should be reporting on the following areas:
Supplier, Quote ID, Time Sent, Time Opened, Time Submitted or Time Declined.
Then from a time range you should be able to evaluate;
Number of Quotes Submitted, Number Responded Too, Percentage of Responded, Number Declined, Percentage of Declined, Average Response Time, Average Decline Time.

This will give the buyer the ability to evaluate supplier responsiveness on an on-going basis to keep suppliers responding in a timely manner. Now if you do not actually DO anything with this information then what good is the information.

What to do with the information -
Once you have begun collecting this information you should make this information accessible to your suppliers instantaneously so a supplier can review at any time and be able to adjust their processes to keep up with your response standards. OH you don't have any response standards? Well take some time (3 to 6 months) to look at your suppliers response time overall and average out based on what ALL of your suppliers response times are and establish a set of criteria to meet your companies needs. There is not a given set of times or national standards for responsiveness, nor should there be. These standards should be set by each company to be able to meet their needs. Suppliers should be informed of your companies expectations and should decide whether they can meet those expectations on a regular basis. If they do not feel they can meet YOUR needs then you should consider whether they are the right supplier choice for your company. I can almost guarantee with a high degree of confidence, that if your expectations are reasonable, that most suppliers can meet those expectations that you establish and if they won't there is a supplier in the industry that will! Suppliers are willing to meet your needs as long as they have a way to be able to measure themselves and to be able to communicate with you when they cannot.
Once your criteria is established and you have communicated that criteria with your suppliers you MUST measure and evaluate them and be willing to call suppliers on the carpet when they do not meet your standards. In other words, some suppliers may pay you lip service when you communicate that criteria so you need to be prepared to implement any penalties that were agreed upon. The first time you issue penalties will likely be the last time you have to issue penalties. Suppliers learn quickly that if they agreed up front and you show that you are serious, they will comply with your standards. If they honestly have looked at their processes and cannot comply they will tell you and likely pull themselves out of the competition. Suppliers are in business to make money just like your company so if something is costing them they would rather walk away than to constantly flush money down a hole.

Staple Offer for Corporate Express REJECTED

According to the Associated Press Corporate Express management rejected the proposal within about 2 hours of the offer being made public. CE officials sited the proposal as significantly undervaluing Corporate Express and failing to reflect CE's value.

http://news.bostonherald.com/business/general/view.bg?articleid=1074569&srvc=home&position=recent

Staples Makes Bid to Acquire Corporate Express

In an email to Staples associates dated 2/19/08, Ron Sargent Chairman and CEO of Staples, notified associates of the proposed offer made to Corporate Express. Below is the text of the email distributed yesterday.

"Fellow Associates:

Today we have taken a significant step in creating a bigger and better platform for all Staples associates to deliver great service and value to our customers around the world. We are pleased to announce that Staples has made a proposal this morning to acquire Corporate Express, one of the world's leading suppliers of office products.

This acquisition will not only significantly expand Staples' North American Delivery operations, the fastest growing and most profitable part of our business, but will also add successful Contract businesses in Europe, Canada, Australia and New Zealand to our portfolio. In addition to expanding our business into new geographies and customer segments, the acquisition will complement our organic growth, representing the addition of approximately $8 billion in annual sales to Staples' $20 billion business.

Corporate Express has a strong management team leading 18,000 associates in 20 countries, and we believe our combined business and people can be even more successful in building a strong, global delivery business. While Corporate Express has not been receptive to our approaches to discuss a possible business combination, we decided to pursue the proposed acquisition because of the tremendous benefits to both Corporate Express’ and Staples' stakeholders, given the complementary nature of our business and the significant opportunities the combination represents. We hope to meet with Corporate Express’ management and complete an acquisition agreement as soon as possible.

We look forward to officially welcoming Corporate Express to the Staples family in the coming weeks and working together to ensure a smooth transition for all associates, customers and suppliers."

The office products market seems to be heating up a bit. The proposed offer is for 7.25 euros per common share of stock. Staples is touting this as a 60% premium from current market value.

Will stock holders snub this offer like Yahoo investors snubbed the Microsoft offer a couple of weeks ago? Let's wait and see!

Read the official Press Release here: http://phx.corporate-ir.net/phoenix.zhtml?c=96244&p=irol-newsArticle&ID=1109564&highlight=

John

Is Data Reporting important to Print Buyers?

Is reporting important to Print Buyers?
In my humble opinion it is the MOST important aspect of any Print Buyers job. Print Buyers are analyst's they are hired to be able to evaluate suppliers from a wide range of areas; quality, turn-around, equipment capability, etc. However at the end of a job the buyer needs to be able to track costs from every aspect possible. I will try to provide a base overview of some of the things my customers say are important to them from a reporting perspective.

One of the very first things most organizations want to know is Tracking Purchases. Organizations want to be able to tell how many of any given item was purchased in a week, month, or year. This includes many aspects such as How many brochures did we order? How many weretri-fold, c-fold, etc? What was the total cost of all Brochures? Of tri -fold, c-fold, etc? Systems must be flexible enough to capture basic information, Product, Attribute, Quantity, Cost. Or the templates must be granular enough to capture some of this information such as;Tri -Fold brochure, C-Fold brochure, or Miscellaneous brochure, for those items that may not be high quantity purchases or do not fit within regular standards. Either way is appropriate it is based on what level of granularity and or how easy you want your templates to be when specifying. This type of report becomes probably the most important when you are considering establishment of single source providers for individual product purchases or when trying to get a handle on what, when, and how much you are purchasing. A lot of potential customers tell me their single most point of frustration is their lack of knowledge about WHAT they are purchasing! Before you say it...yes, you can go back to your accounting system and trackPO's back to suppliers and likely they are even coded within your accounting system to allow you to see they where budgeted against your print budget. But even this is flawed as I just had a discussion with a customer that their departments would use their print budget code to make purchases for other things such as; shop rags, or for other NON-PRINT related items. So when the president of the company says; "How much did we spend on print?" it is not the easiest question to answer. One organization (actually several that I know of) have had to resort to hiring an outside consulting firm to help them get a grasp on their actual print spend. The sad part of this is that by implementing a system to track print procurement you could easily get an accurate count of your spend down to what was purchased. One customer was able to identify that they were spending $100 million per year on print but it took them 6 months and several thousands of dollars to find that out, when with a system they could have simply clicked a few buttons and had the most up to date information available at their fingertips.

So why should I be so concerned with what I am spending in print?
Because likely your companies CORE business is not print procurement. It is more likely things like manufacturing or service related industry. So when budget crunch comes, a couple of the most likely areas that management will look to cut will be the marketing department where likely all of the print purchases come from. So indirectly (or quite directly) print procurement is the likely area to be cut without any solid information as to whether that is the best choice or not. If a buyer can show and provide accurate and solid information to the company president as to what is being spent, it is easier for them to weigh the Return On Investment and likely they will look to cut costs in other areas of the company if you can show the value that print is providing to the organization. Presidents are going to cut areas that cannot show or even have a handle on the spend. Reporting provides the president with not only the information but assurance that your department is aware and can react quickly to decisions that may need to be made.

How equipped is your organization to be able to respond quickly and accurately to your managements inquiries?

Next episode - evaluating supplier responsiveness!

Is it time to consider PDF a threat?

As Joel Hruska points out in his article on ARS Technica, Adobe seems to not be doing themselves any favors once again. Printers should seriously consider the possible damage that could be caused to a 6 figure piece of equipment because of a $49.00 piece of software. Read Joels article here: http://arstechnica.com/news.ars/post/20080212-is-it-time-to-consider-pdf-a-threat.html

Has it all been said?

One of the interesting things about going to conference's is the opportunity to talk to people and explore the surroundings of a conference find restaurants nearby etc. A part of that interest comes in hearing the topics of the conference being discussed over the dinner table with people you have met only a day or two before and sometimes people you work with for years. I find it interesting in hearing the conversations of what was missing or what the conference lacked because likely those things do not get on the evaluations after the conference. At this show I have heard a recurring theme over the last couple of days there is some great information but none of it really applies to my business or my situation. Or, "they should have..." you know...they should have talked about this... OR they should have talked about that...Or why didn't they have this company or that company at the show. Sometimes this is just "Babble" you know the kind where the person saying it doesn't really know what they are talking about they just want to hear their own voice...or their afraid of the silence that might suddenly appear around the table. Other times though there are some good ideas...the one I heard today seemed very pertinent to this particular show. Companies are using systems to purchase and track their print costs and sometimes they are not always the right system for the job. So why did we not hear about purchasing and procurement systems? Why did we not hear about processes to make your production more efficient? Or even what kind of reporting is important to our supervisors or is reporting important even? The short answer for most of this is that I think there is a wide variety of personalities in this type of work. You have creative types that by their own admission spreadsheets scare them, and then you have the analytical's, the ones that if you stuck a paint brush in their hand they would think you wanted them to paint the house! It is a tough mix in this industry and I am not saying it should be all one way or the other, I just think there isn't enough focus on the analytics, the business side of producing print the processes involved in actually take a set of specifications and turning them into a brochure. For the next few weeks I think I will try to answer some of these questions you may have walked away without answers to. I think the reporting questions are probably some of the most important questions to answer as from a system producer perspective this is always one of the first questions about our system that I get from the decision makers in a company. So I will try to start with the questions and hopefully provide some answers for your boss. So back to my original question; Has it all been said? I don't even think it's been asked yet!!!
By the Way! This is a great show and has a LOT of variety!
JG

A Quick Note From Print Oasis 2008

Good Morning from Amelia Island FL.
The weather has been incredible these past few days...Sunshine, Warmth, the Ocean Breeze! The conference is busy and active as usual with great speakers and LOT's of Exhibitor's.
There are more exhibitor's at this years show than at least the last 4 years reaching more and more Print Buyers. It is 8:30 in the morning and the lecture I am sitting in is full of attendee's. My rough count is 250. The show floor is busy and filled with Print Buyers looking for everything form the latest in promotional items to variable data printing formats and technologies. There are Printers, Office Supply companies to Software Solutions providers exhibiting at the show. Tonight is the Paper show where some of the leading paper companies will be displaying their goods and materials for all to consider.
I am currently sitting in on Steven Lance and Paul Kurnit as they discuss branding 2.0 The session is focused on advertising and the print industry. The show is full of great information for all print buyers across any industry. Steven and Paul will be doing a book signing later today on the exhibit floor. Well time to get back to the show! Wishing you were here!

Print Oasis 2008 this weekend!

This weekend is Print Oasis 2008 being held at Amelia Island Plantation resort in Amelia Island Florida. The show begins Saturday and runs through Tuesday, with opportunities for Print Buyers and Suppliers to mingle and gain knowledge of the latest happenings in print procurement. This is a great opportunity as well to talk with print buyers from all over the country and gain insight into the needs of print buyers. James Tower will again be exhibiting at the show. I will be there along with one of our sales reps to discuss Cross-Wind and our many other services we provide to print buyers. If you are at the show please stop by and say hi and tell me what you think. You never know you might just get mentioned in my blog! Hope to see you there!!
Information about the show can be found at: www.printoasis.com

New Customer Implementation for Cross-Wind

I am sitting in the Newark airport after leaving a new customer implementation that I have been on all week. It is Raining and flights are delayed so I thought this the perfect time to update the blog.
I have spent Monday through today in the customers office setting up print product templates to meet the customers specific needs and to add their supplier base and the buyers into Cross-Wind I will try to give you a breakdown of my week and the customers response to all of this.
Day 1
was spent understanding the customers current purchasing processes and mapping out Cross-Wind to fit that process. In addition, I reviewed a demonstration site with the customer to show them how their process would look once their application was set-up. I also added all of the customers suppliers information into the system. One of the great things about Cross-Wind, is the ability for the customer to put their specific vendors in the system.
Day 2
Set-up of modules to fit the customers need, I added the customers buying team and assigned access permissions, from there we reviewed product templates and inserted attributes for the customers templates, we applied pricing structures for their templates and we built the templates to be used.
Day 3
We reviewed the templates and pricing applied to each and then created the product-to-supplier associations. When this was completed we did a final over view of the administration tools and then began a complete walk through with the customer of their application and made minor site adjustments on the fly.
Day 4 TRAINING DAY
8:00 AM we set-up for Buyer training which was split into two sessions to allow for supplier training in between. We trained the buyers in the process of creating a project, specifying the product, selection of suppliers, and submission of the RFQ. At this point the suppliers were receiving quotes within the system and allowing them to begin review so we immediately went into supplier training. The suppliers called in to a conference bridge and a LiveMeeting demo of how to respond to quotes. The supplier training session was completed in one hour and all suppliers were able to login and begin sending responses to our training quotes. After lunch the buyers were trained to review the quotes and how to submit proposals to their customers and how to submit purchase orders back to the suppliers. The buyer and customer training was complete by 3:00 PM and the buyers spent the rest of the day practicing.
Day 5 System Live Day
When the buyers reported to work this morning they began entering live quotes within the system and began receiving quote responses from their supplier base. I answered follow-up questions and helped the buyers with any problems they were having in navigating the system. I thanked everyone for their time and the opportunity to learn another customers processes.
Overall, What a great week! The customer is extremely pleased with how Cross-Wind works and how flexible it is for them. I will follow-up with them most of next week to ensure that it is functioning in the manner they expected and I will return to their location in about 6 weeks to do a follow-up and to show them how to use the custom and scheduled report features. In addition we have tentatively scheduled a 3-day session to implement another of their buying facilities into Cross-Wind in the next 6 weeks. I can't wait to reveal the customers name, but until approvals and finalized contracts are complete I cannot. But it will show how flexible and wide ranging our customer base is.
Well I hope all have a great weekend and It looks like my flight will only be 2 and a half hours delayed!!
John