Price monitoring in purchasing
Achieve better purchase prices and an agile purchasing process with automated price monitoring
All too often, purchasing processes are pretty static, making it hard to take current market developments into account. Automated price monitoring streamlines purchasing processes for greater agility, widescale cost savings and better supplier relationships.
Long-term supplier contracts are a gamble… that rarely pays off
The last few years in particular have highlighted the many limitations of opting for long-term agreements in purchasing. The prices you negotiate rarely match current market prices for long, as prices keep changing, and crises and market developments like supply shortages can quickly cause a massive cut. One way or another, you or your suppliers won’t like it, putting a strain on your relationships.
Too much like hard work… for a patchy overview
Manual methods for identifying a fair price just can’t keep up with today’s market dynamics. The effort required to monitor prices manually is huge and eats away at valuable resources. Plus, you’ll only stretch to spot checking your most important products, never mind gaining a comprehensive market picture with high volumes or tracking fluctuations continuously and reliably by manual means alone.
Pressure piling on… internally?!
Add to this the growing pressure from internal target groups. Comparison portals like idealo or marketplaces like Amazon allow your team to scrutinize the prices of a whole host of standard materials. If the price negotiated by Purchasing is seriously higher than the current market price after drastic price changes, you’ll soon find yourself in a tight spot, with nothing much you can do to change those contractually agreed conditions.
Price monitoring takes indirect purchasing to the next level
Purchasing covers a wide range, but nowhere is price monitoring more useful than in indirect purchasing. It can help overcome the numerous obstacles mentioned before, transform processes and improve performance. Items like office supplies and equipment, IT accessories, uniforms, protective gear, tools and lighting are all things you don’t have to buy from behind closed B2B portals. That means algorithms can automatically source product data, including price and discount info, from marketplaces, online stores and price comparison sites in high volume and frequency.
“The latest market data from XPLN saves us almost 1 million euros a year in purchasing – an enormous return on investment.” – Dennis Westkamp, Head of Sourcing Indirects at Vonovia
This isn’t a thing yet for special goods and product groups that you can only procure via closed B2B portals. But as these B2B portals open up, you’ll be able to leverage price monitoring for an even broader selection of goods.
Better prices in purchasing
Want huge resource savings and a comprehensive market overview? Try automating data procurement. With more quantity and better quality, the advantages are clear. Price transparency smooths the way for a stable negotiating position and better purchase prices. Plus, it will help you develop an agile purchasing process, for example by negotiating prices once a quarter instead of once a year.
Strategic advantages for efficient purchasing processes
Data adds transparency, allowing you to build more trust with suppliers with an open-book policy. Translate this trust into strategic supplier relationships by developing opportunities for better collaboration that benefit both sides. These can include deeper IT integrations for increased efficiency, additional services (catalog maintenance, warehousing, warranty processing) or preferential treatment in times of crisis.
Low effort, high ROI
Putting a price monitoring solution in place is quick and easy. And as well as some serious purchasing benefits, you can also optimize your purchasing process as a whole and develop suppliers into strategic partners. The ROI for using the software is enormous.
Find out how Vonovia uses price monitoring to achieve cost savings in purchasing of almost €1 million per year and builds strategic supplier relationships.