The Bottom Line

5 Tips to Maximize Value in Vendor Relationships

Posted by Strategic Resource Management on Oct 5, 2018 9:00:00 AM

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All manufacturers want to get the best possible deal from their suppliers. However, the definition of “best” is subjective. Every partnership has different goals and non-negotiable points. We’ve found that before starting the contract negotiation process, a cross-functional team is well advised to invest the time to decide what it wants and needs from the relationship.

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Topics: Manufacturing, Vendors & Contracts

How Can Small Manufacturers Tap Into the AI Revolution?

Posted by Lawrence Pruss on Aug 22, 2018 10:00:00 AM

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Artificial Intelligence (AI) is on everyone’s mind in the manufacturing industry. The nation’s largest companies are investing in this technology, and countless startups are working feverishly to stake their claim to various use cases. While AI is often positioned as a threat to human jobs, it can actually enhance how humans serve customers in many ways.

The big corporations have an inherent advantage in harnessing AI to their benefit. AI runs on data, and they simply have more of it. They have hundreds of thousands of customers. They also have more resources – both dollars and full-time employees – to utilize and monitor AI. This doesn’t mean there’s no hope for smaller businesses, though. Data can be pooled and anonymized across groups of smaller manufacturers, generating many of the same powerful insights.

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Topics: Manufacturing, Vendors & Contracts

Corrugated Contracts: Three Reasons To Take A Closer Look

Posted by Jim Kurtz on Jun 26, 2018 9:00:00 AM

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My colleague Gene Ciemny recently wrote about the increase in pulp and paper costs after an extended period of price stability.

While there are common threads across contracts in different industries, there are also important distinctions in market dynamics, industry customs and terminology specific to various industries. Let’s explore some of the key factors to consider in vendor contract negotiation for paper.

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Topics: Manufacturing, Vendors & Contracts

Don’t Get Boxed In By Increasing Pulp & Paper Costs

Posted by Gene Ciemny on May 30, 2018 9:00:00 AM

Don’t Get Boxed In By Increasing Pulp & Paper Costs

Last year, in a blog post we warned of an imminent trend of rising pulp and paper costs that would soon hit the pocketbooks of any manufacturers relying on corrugated boxes to ship their products. It’s no fun to say I told you so (well, sometimes it is…) but the past year has proven us right.

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Topics: Manufacturing

Vendor Contract Management: Why Paper Supplies Will Remain Tight

Posted by Jeff Moeller on Jan 30, 2018 9:00:00 AM

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The continuing explosion in online retail sales was one of this holiday season’s major headlines. While there has been plenty of debate over its impact on shopping malls and other brick and mortar outlets, another downstream effect is rarely discussed—one that can be seen on your curb every recycling day.

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Topics: Vendors & Contracts

Never Sign a Vendor Contract Amendment Without Vetting It

Posted by Patrick Goodwin, President on Jan 16, 2018 7:00:00 AM

Amendment-215155-edited.jpgVendor contract amendments can look simple and harmless – a brief paragraph, perhaps up to two pages, addressing some routine items. They often even include an upfront payment to recompense for your troubles, an unexpected “bluebird” that might help offset the inevitable budget worries. Don’t be lulled into complacency. These few sentences can carry significant implications and should be inspected just as closely as your original vendor contract.

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Topics: Vendors & Contracts

How Vendor Contract Management Can Help You This Budget Season

Posted by Ben Mrva on Jan 9, 2018 7:00:00 AM

Budget.jpgFor anyone working at a company with a calendar-based fiscal year, chances are that department heads are being asked to “do more with less,” or at least to increase output at a faster rate than costs. As anyone with budget responsibility knows, it’s no easy task to fund realistic pay increases for appreciated employees let alone accommodate growth in other expense areas.

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Topics: Vendors & Contracts

Less is More: A Case Study in Manufacturing Vendor Contract Management

Posted by Jim Kurtz on Dec 19, 2017 8:00:00 AM

 

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If your organization utilizes a strategic sourcing partner, that relationship should extend beyond ensuring the prices you pay vendors are consistent with what is being charged across the industry. A skilled sourcing expert can identify opportunities for process improvements that may have no influence on the invoice but will have a material impact on your bottom line.

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Topics: Manufacturing, Strategic Sourcing, Vendors & Contracts

Proceed with Caution on Vendor Contract Changes – A Real World Example

Posted by Jim Kurtz on Dec 13, 2017 11:00:00 AM

Short TermLong Term.jpgIn recent posts, we have offered words of caution concerning the perils of free money when considering a proposal, contract or addendum from a vendor. As part of our work, we are continuously monitoring the market to remain current on the trends that impact our clients. Lately, we have seen a real-time case study playing out in the market that reinforces why every proposed vendor contract amendment should be reviewed carefully.

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Topics: Strategic Sourcing, Vendors & Contracts

How to Cost Effectively Monitor Vendor Contracts

Posted by Michael Carter on Oct 5, 2017 1:00:00 PM

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A study conducted by the International Association of Contract and Commercial Management (IACCM) found that poor vendor contract management processes cost companies as much as nine percent of their total revenues. Although this was a cross-industry study, there is little reason to believe manufacturers, distributors, or retailers fare any better or that the picture has improved since 2015. With so much money being left on the table and the drumbeat for cost efficiencies sounding as loudly as ever, manufacturers are seeking new ways to make this area easier to manage more effectively.

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Topics: Manufacturing, Vendors & Contracts