Group B9

Case 1
Yes, it would impact the tender submission. The % weightage would have supplied
information critical to understand the buyers requirement clearly.

For instance, if buyer is seeking low cost, basic functionality product (or services) then %
weight to commercial parameter would be high.

Absence of complete information would delay the procurement process as suppliers would
ask for the missing information.

Not specifying the weights may result in eluding a perfect buyer-seller match.

On the contrary, buyer would get healthy participation from different vendors regardless of
their technical and commercial capabilities. Buyer would get a fair idea about supplier
market.

CASE 2

Our Core service

strengths and
Competitive Edge

E-Procurement Solutions
best suited for Consumer
products & Goods
Industries
Business Case for an EPurchasing System :
Products involved are
large volume, low
value goods eg. food
and beverages,
clothing, tobacco and
household products.

Sell to body
:Corporates
CPG one of the largest
industries in North
America, valued at
approximately US$2
trillion.
Although growth has
slowed in this industry,
companies that
provide CPGs still
benefit from large
margins and strong
balance sheets.
Eroding brand loyalty
and Rising digital
influence on consumer
shopping provides
growth opportunities to
up coming players.

Present day procurement needs

The Purchasing Division buys services and products
in the following categories:
Packaging
Ingredients
Raw Materials
Capital/Construction and Engineering
Maintenance, Repair Services and Operations
Legal and Real Estate
Human Resources, Security Services and Office Products
Telecommunications and IT
Marketing, Printing and Promotions.

Why consumer products and goods industry should adopt E-Procurement

Industry Challenges
Changing Customer Demand and Eroding Brand Loyalty:
Consumer preferences have altered greatly in recent
years as demand shifts to healthier and sustainable
options. Thus, manufacturing success is closely related to
time-to-market and new product introduction (NPI)

capabilities.

Consumers prolonged recessionary mind-set: Economic

uncertainty & recessionary effect have left US consumers
cautious and frugal. *94 percent of buyers plan to keep
their spending on consumer goods at its current level
even if the economy improves.

Compliance and Regulatory Pressures: The global

regulatory environment is dynamic. Companies are
faced with the challenges of mitigating operational risk
and managing conformance to compliance and
regulations becomes a factor.
Powerful retailers are squeezing profits: The massive
buying power of retail giants put pressure on suppliers.
Also, they are developing private labels which are
becoming popular among consumers.* 88 percent US
buyers think private labels are just as good as national
brands.

Why should they adopt EProcurement

360-degree spend visibility and intelligent sourcing
offers cost competitiveness and increased profitability

Detailed visibility into both direct and indirect

spending
Abilities to rapidly build and execute competitive
bidding events
Rapid discovery of information from global supply
markets
Structured sourcing-decision support and optimization
Enables companies to collaborate closely with
suppliers
Thorough vetting and rapid on-boarding of suppliers

Structured performance measurement and

management of suppliers

Avoid compliance and regulatory deviance

Accurate and timely information of supplier

credentials and certifications attain compliance to
CPSC, FPLA and FCPA

* Source: Deloitte Study

E-Procurement technologies
Guided buying process to simplify user experience and configurable workflow approvals for better control and visibility

End-to-end catalog life-cycle management for hosted or punch-out catalogs

Self-service supplier portal interface to publish and maintain catalog content

Facility to bookmark favorites, create shopping lists and share them with other users
Use eSOURCING to take full advantage of global market competition and to maintain strict oversight of supplier discovery and
sourcing decision-making across increasingly remote global locations
Use SUPPLIER MANAGEMENT to obtain and maintain accurate, up-to-date information around supplier credentials and certifications

Use FINANCIAL SAVINGS MANAGEMENT to align procurement with both bottom- and top-line business performance objective

Calculation of the impact of procurement savings on P&L and balance sheet

Classification of KPIs for benefits

achieved through e-procurement
Hard benefits

Deliver enhanced
shareholder value,
price saving, process
cost reduction

Soft benefits

Less effect on cash

flow, individual time
freed up through
efficient process

Intangibles

Cultural change, eplatform, high visibility

of supplier
performance
The above benefits
can also be
categorized into
following benefits: Transactional,
compliance,
management
information, Price
benefits

Monitoring of achievement of expected

benefits of e-procurement
Benefits Realization Forms and Database - A savings capturing process should be collected, validated,
recorded centrally in a database & reported on a periodical basis

Spend Analysis - A spend analysis tool helps users to analyse spend data via a self service portal for
meaningful information and patterns
E-intelligence - A collective term for sources of information that are made available to assist procurement
professionals with finding required information. Incorporates supplier intelligence, newsfeeds, contract
database, vendor surveys, customer satisfaction surveys, and transactional data.
E-procurement scorecard - Fields on the scorecard may include: e-procurement transactions to date,
savings recorded to date, costs to date, suppliers adopted to date, number of end users, improvement in
payment terms with key suppliers, e-tool usage (for electronic auctions and tenders).
Supplier scorecard - Reflects the performance of an organizations key suppliers. Fields include financial
spending details with each supplier, supplier performance (quality of goods,service, logistics ability, etc.),
payment terms

Market Entry Barriers

High Initial Capital Investment for
CPG
For CPG clients to switch from the
existing manual process to an
automated process can be an
expensive affair and a high initial
capital investment is required.For
SMBs, which has large potential,
E-procurement might not be a
viable solution

Low Supplier Resistance

Most of the early e-procurement

models came with a built-in
barrier to supplier adoption
participation and/or transaction
fees (2 percent of the order value
on average), usually to continue
to receive orders on contracts
they already had.

System Integration Issues:

An inadequate technological
infrastructure at CPG Client to
support e-procurement might
harm the demand. Catalogue
integration is considered as one
of the main issues.

Data Security and Authentication:

Change Management:

Data Security is going to be one

of the major decider for the
group to excel in the e
procurement offerings. Level of
resistance in the case of
electronic payments is crucial

The attitude of the higher

management and leadership at
CPG will be a high obstacle
considering the migration
requirement from manual
process to eprocurement

Groups niche
Guided buying : Steering users to right category or suppliers with compliant, captures spend,
more accurately, with better usability
Artificial intelligence to automatically classify the users' search term and suggest the most
appropriate category for the search, to ensure easy shopping experience

Support for integration with the legacy system

Support and training facilities.

Calculation of the impact of procurement savings on P&L and balance sheet

THANK YOU