Procurement operations at global retail chains such as Walmart, Reliance Retail and Amazon are quite massive and elaborate. From electronics to movies to clothing and much more, these retailers spend millions of dollars every week to procure products from 100+ categories and brands. The procurement teams not only focus on negotiating purchase orders but are also responsible for managing the overall category revenue and individual category sales.
For retailers of such magnitude to small businesses, procurement management decisions can make or break their organization’s growth or result in revenue loss. As global business models renovate post-COVID-19 crisis, retail supply chains are under immense pressure to adapt rapidly to consumer shifts.
Procurement Roadblocks for the Retail Industry
- Evolving global landscapes and rapid market volatility
From the onset of COVID-19, global suppliers had temporarily stopped the outflow of raw materials and other goods due to multiple nationwide lockdowns. A research survey conducted by EY highlighted that only 2% of companies were completely prepared for the pandemic, while 72% of the respondents reported a negative effect. As a result, traditional and new retailers had no choice but to revamp their operating models.
- Increasing demand for faster delivery
As per the EY Future Consumer Index, over 21% of consumers were willing to forgive brands and retailers for delayed services due to COVID-19. This has resulted in supply chain teams working under tremendous pressure to meet the consumer demands and opt for a more transparent, cost-effective, and faster supply chain process.
- Complicated relationships with suppliers
Developing good supplier relationships has always been a hot topic for retailers. Whether it’s to reduce costs, procure quality goods, or gain a competitive edge, supplier relationships have evolved from being just a transactional relationship. However, tracking and managing data for individual orders and multiple suppliers via manual processes can be complicated.
How Can Procurement Solution Help Improve Retail Management?
With manual procurement processes becoming obsolete and complex, utilizing procurement solutions can help retailers manage the process more efficiently and transparently.
- Improved supplier performance and related risks
With a fully-optimized procurement software in place, you get in-and-out visibility of the supplier’s life cycle. You can also add transparency to your purchase orders (POs), ensure on-time delivery, improve operational efficiency, and identify new suppliers outside your network.
- Maximize margins and savings with eAuctions
By leveraging reverse eAuctions, retailers can achieve up to 15-10% cost benefits and bring greater value to their organization. eAuction is a powerful feature that stimulates faster negotiations and real-time bidding from suppliers and brings transparency while nurturing strong relationships with suppliers. You can also derive actionable insights from a centralized procurement platform to improve your cash positions and procurement strategies.
- Boost time-to-market with enhanced supplier collaboration
An automated solution can help your procurement team reduce PO cycle time and innovate contract management. You can also help in shortening time-to-market while working closely with suppliers and identifying product innovation gaps with long-term collaboration.
To stay ahead of the market, it’s imperative for businesses to rapidly build resilience and eliminate bottlenecks in the supply chain cycle. Efficient procurement management can help you achieve agility and manage data responsibly. With Procol’s advanced and user-friendly procurement solution, you can manage your end-to-end procurement processes like PO raise and approval, contract management, spend analytics and much more, all in one place. Want to know how we can revolutionize procurement for you?
Schedule a demo or connect with an expert now.