{"id":2082,"date":"2005-05-03T11:44:00","date_gmt":"2005-05-03T11:44:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2005\/05\/03\/the-outsourcing-of-purchasing\/"},"modified":"2023-06-28T07:47:17","modified_gmt":"2023-06-28T11:47:17","slug":"outsourcing-of-purchasing","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/outsourcing-of-purchasing\/","title":{"rendered":"The Outsourcing of Purchasing"},"content":{"rendered":"

If you\u2019ve read \u201cWill This Purchasing Trend Take Your Job\u201d and are worried, NLPA is here to help.<\/p>\n

Outsourcing any function is a way of spending money to save money. Getting a return on investment with an outsourced supplier.<\/p>\n

Third-party procurement providers sell themselves based on return on investment. \u201cYou spend $1 million with us. You\u2019ll save $3 million.\u201d<\/p>\n

Cut them off at the pass. Before they even have the opportunity to make their pitch to your senior management, you should already be calculating your return on investment.<\/p>\n

If you\u2019re a buyer, you should be calculating your salary plus overhead (add 30 \u2013 50% to your salary) and comparing that expenditure with the amount of money you are really saving your company.<\/p>\n

If you are a manager, you should be comparing your department\u2019s annual budget with your department\u2019s annual savings.<\/p>\n

You should be saving more money for your company than your company is spending on you or your department.<\/p>\n

And \u2013 this is really important \u2013 you should be reporting your return on investment to management. They may think of your pay or budget as a cost, not an investment, unless you continually and persuasively communicate your value.<\/p>\n

Beat the third-party procurement providers at their own game. But do it before you are placed in a situation where you are essentially bidding against them.<\/p>\n

Become a member of one of the world\u2019s largest procurement associations today.<\/p>\n

 <\/p>\n

Recommended Reading<\/strong><\/p>\n