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Procurement Basics
by Zoran Kecman
3y ago
  In May I have started the Procurement basics blog. To keep me busy and to fulfil a long time  desire to share knowledge about #procurement. By the end of 2020., the blog reached 10,000 views! So I decided to create a web page where I will share more in addition to the blog posts.  For new content please visit us at  www.abcofprocurement.com ABC of procurement Disclosure: This page contains affiliate links. If you click through and purchase an item, I may earn a commission ..read more
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Weekly digest: procurement and Supply chain news 26th December
Procurement Basics
by Zoran Kecman
3y ago
 Merry Christmas! I hope you are well and able to enjoy the holidays with at least your immediate family. To help you digest all the food you had yesterday, here are some interesting articles. Enjoy! Retailers, warehouse operators, manufacturers and logistics companies are not only shifting their operations to meet changing consumer requirements; they’re increasingly relying on technology to help them do it. 5 Supply Chain Trends for Small and Medium-Sized Companies to Watch in 2021 Blind RFI can be defined as the process of preparing and publishing an RFI, to the shortlisted vendors w ..read more
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The reputation of procurement teams
Procurement Basics
by Zoran Kecman
3y ago
Procurement teams are rarely the superstars in the company. And I have a strange feeling that no one notices the procurement guys until something bad happens. Something needs to be done about it. It happened to me on so many occasions. We were flagged as the ones delaying everything. The admin staff whose job is only to type the LPO. And, as per "them", we were not able even to do this good enough.  Generally, the procurement team does not have a great reputation in the organization. I believe that this is rooted in the way we do our jobs. And that it is in part our fault.  So here ..read more
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What are tiers
Procurement Basics
by Zoran Kecman
3y ago
 We all know what are tiers. They are layers, stacked one above the others. In procurement, tiers are suppliers of a supplier. Or, maybe it is easier to explain this using this diagram: In an ideal world, we should worry only about our tier 1 suppliers. And they will take care of their suppliers and so on. However, many times things go wrong, and we feel the pain. How? Let me get you a couple of examples. Full links are available below the post if you would like to dig deeper.  Last year (2019) Apple, Google, Microsoft and Tesla found themselves in a court case due to child labour ..read more
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Procurement and Supply Chain digest 18th December
Procurement Basics
by Zoran Kecman
3y ago
 As we are getting ready for the Holidays, here are the latest Supply Chain and Procurement articles. Enjoy! In many large businesses, it’s still very much the case that Procurement and Accounts Payable work separately. Traditionally we work in a very closed shop, but it doesn’t have to be like that. Certainly, it could benefit the whole organization if it weren’t operating in silos. To Procurement and beyond — bridging the supplier information gap According to a recent McKinsey survey, the majority of senior supply chain executive respondents said the crisis revealed weakness in their ..read more
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Is procurement adding value? - Procurement basics
Procurement Basics
by Zoran Kecman
3y ago
Are we, procurement guys, adding value to the company? Some see us as guard dogs, admins, useless annoyance. A waste of time, doing something they could do much better and faster. How to prove our contribution to the bottom line? In most companies, departments are classified into three groups per their contribution to the profit of the company. The first group are the profit makers. This is the value-adding part of the organization. Production is the primary. Also, the sales department is considered very often as profit-making, as it adds the profit margin on top of production cost. The secon ..read more
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Do we need a lawyer in procurement? Contracts in procurement
Procurement Basics
by Zoran Kecman
3y ago
A bad contract can spoil all our efforts and long negotiations. While a good one can save us from a lot of trouble. Finding the sweet spot between complexity and protection is the ultimate goal.  If you are long enough in procurement, chances are you will get into some kind of trouble with your supplier. He will delay shipments. Or try to increase the price. Or your stakeholders will figure out that their forecast was a bit too bold. Like 200% higher. And then you will start looking into your contract. Procurement contracts do not need to be 25 pages and cover every possible option. B ..read more
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Procurement and Supply chain digest 11th December
Procurement basics
by Zoran Kecman
3y ago
 The weekend is there, finally!!! And also a couple of great Procurement and Supply chain articles for you. This is a choice from the past week, in no particular order. Enjoy! Classifying your spend data? A big waste of time, surely … or a crucial step that needs to be taken without delay? The Classification Guru Susan Walsh explains why this needs to happen immediately. A waste of time or a gold mine? Why you need to classify Your spend data ASAP As COVID-19 cases rise around the country and world again, consumers are going back to their panic buying ways (like toilet paper), bu ..read more
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17 examples of Procurement KPI’s + how to pick good KPI’s
Procurement basics
by Zoran Kecman
3y ago
 We all have to do them. But do we really choose the ones that will help us to have better procurement? And which one to choose?  Just to start writing about KPI’s took me a couple of days. And creating them looks like torture. Yet still, all companies insist on them, and professionals go back to the “What gets measured, gets improved” mantra.  What are these famous KPI’s? Let us go to www.kpi.org, and see what they have to say “Key Performance Indicators (KPIs) are the critical (key) indicators of progress toward an intended result.” So, a good KPI will give us exactly how ..read more
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TCO – Total cost of ownership
Procurement basics
by Zoran Kecman
3y ago
While in our “normal” life we do not think too much about this concept, in procurement it is quite important. Especially in Capital expenditure, known as CAPEX. It is not only how much we initially spend, but as well what happens during the lifetime of the asset.  This is a real example. I got a task to procure new vans for the company. And I did what everyone would do. Collected specifications, reached out to a couple of vendors. Got the prices, negotiated with the best two. Made a nice sheet and sent it out to the General Manager. He had a finance background. And some earlier experience ..read more
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