"True Leverage" -- How Do You Approach Potential Suppliers?

April 28, 2010 12:34 PM | Categories: John Sharman, Spend Management

Spend Matters would like to welcome back John Sharman, President & CEO of Sharman Consulting Group.

Everyone is familiar with the concept of leverage when it comes to procurement. We as buyers approach a potential supplier and make the case for lower prices due solely to the total amount we spend with the company. With this approach, we have all experienced success -- and we have all experienced the feedback, "you already buy at prices lower than much larger customers."

When we hear this, is it usually true, or is the sales person merely placating us to protect his or her company's margins and his or her commissions? I think I could successfully argue that it's both. We would be naive to think that just by merely asking for lower prices, or threatening to go to another supplier, that our incumbent supplier would automatically lower the price.

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Moving the Needle -- Turning the Focus to Direct Materials Sourcing

February 9, 2010 2:56 PM | Categories: John Sharman, Sourcing, Spend Management

Today, Spend Matters would like to welcome guest contributor, John R. Sharman, Jr. John has a highly distinguished career in the procurement world both as a practitioner, and as an advisor to senior executives. John recently launched a new consultancy, Sharman Consulting Group, LLC. We look forward to publishing additional contributions from John in the future. If you'd like to get in touch with him directly, please send an email to: jsharman (at) sharmangroup (dot) com

It's been over 10 years since the promise of e-procurement was introduced to business. With this passage of time, most of the hype promised across many business areas has failed to materialize. Senior executives in most businesses have grown weary of hearing about how they would or will save millions of dollars on office supplies and other minutia merely by buying from preferred suppliers over the Internet, using one of many e-procurement applications.

Is this because senior executive don't want to save millions or is it because the savings have failed to materialize despite numerous attempts to realize (and continue to save) those millions? Well, clearly, any senior executive worth his or her salt is always interested in saving money, so disinterest is an unlikely reason.