Quotations also cost time and money. Between salaries, computer equipment and office expenses, a company spends $40,000 MXN per month on quotations.
It is very useful to make different quotations, especially when a category has a high value for the company and the offer has a wide diversity.
Whenever a category of low value for the company has prices that do not vary that much, the quotations lose their usefulness and therefore represent a waste of time and money.
However, it has been proven that you can save up to 20% by shopping around before buying a category. Therefore, it is important to know how to identify the categories that are worth quoting.
There are two variables that allow us to identify which categories are worth quoting.
- And the value it represents for the company.
- The complexity of obtaining that good in the market.
Routine Products (+,-): When it is easy to acquire a category that is of lesser value to the company, these are small, almost instantaneous purchases for which little planning is required. The best practice for these is consortia:
Consortia are alliances between companies through which a buyer receives the catalog of suppliers with established prices to make more efficient purchases. This is known as Spot Purchases or Shopping Kart.
The same quoting strategies as for bottlenecks (outsourcing, local purchasing and standardization) are recommended for these consortia.
Bottlenecks (-,-): When there is little(-) ease of acquiring a category that has little(-) value for the company.
It is worthwhile to identify companies specialized in supplying that category. It is therefore recommended to first make a research to identify local suppliers offering the same good.
Strategies should focus on facilitating the acquisition of that category. Therefore, the most advisable thing to do is to adjust some characteristics of the category to make them more similar to the offer, this is known as standardization.
Leveraged products (+,+): Categories that are of high value to the company and are easy to acquire in the marketplace are the ones that lend themselves most to leveraging quoting strategies to buy the best deal.
For this it is important to know the drivers that affect the market and to know before a negotiation.
This implies taking advantage of the analysis period with a periodic price evaluation to integrate categories with better knowledge of how the market will move. And identifying and designing better buying conditions.
This involves Rapid Sourcing, for example, generating annual supply agreements that make supplier proposals known.
These can be used to unify suppliers in different categories, identify suppliers that serve a higher volume and evaluate the benefit of generating synergies with current or new suppliers through volume consolidation and cost breakdown.
Strategic products (-,+) = (-) : When it is very difficult to obtain a category that has a high value for the company, strategies must be formulated to reduce the risk of shortages.
In these categories you can generate savings in acquisition costs, greater than those you can generate with a price reduction. Therefore, it is important to ensure the best supply conditions.
It is advisable to become one of the highest links in the supply chain of our suppliers in order to obtain the best purchasing conditions. To be able to constantly resort to reliable suppliers who provide a solid foundation for negotiations. Long-lasting relationships need to be built.
Therefore, the sourcing process needs a strategy that contemplates the best proposals from qualified suppliers. Sometimes this involves adjusting the category characteristics to match the offer.
It has been proven that buying without quoting generates an increase in the price of 20%.
If a person makes around 80 quotes per month (equivalent to 4 quotes per day). Each quote represents an expense of $500 MXN.
To be worth quoting, the 20% that can be saved should not exceed the monthly quoted cost of the product ($2,500). Therefore, quotations should only be made for purchases costing more than $40,000 per month.
B2B Cotiza allows a buyer to make twice as many quotations in the same period (160 quotations). Therefore, the cost per quote reduces to 50%. This means that with B2B Cotiza the $2,500 MXN that it costs to quote monthly, reduces to $1,250 MXN. The cost per quote reduces from $500 MXN to $250 MXN.
Therefore, prices can be reduced even on purchases of $20,000 MXN per month.
Make an Automatic Sourcing with B2B Cotiza.
