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Improve Vendor Contract Management

How to Improve Vendor Contract Management

Improve Vendor Contract Management

Contracting with vendors is a laborious process. The process typically goes like this:

  1. Identify vendor options
  2. Standardize scope of products from vendors
  3. Request pricing
  4. Narrow vendor selection
  5. Fine-tune pricing
  6. Select ideal vendor considering price, product quality, reliability and customer service
  7. Contract with selected vendor; and finally
  8. Rollout vendor offering to employees

 

We’ve seen this process take anywhere from 45 days to 18 months. Yes, seriously. There are so many different components to the process, any one of which can take months to complete. The result is costly on multiple fronts; every day that passes without a vendor contract means your company is continuing to pay exorbitant pricing under current policy and the longer the contracting process, the more you pay in legal fees reviewing and fine-tuning a program.

The concept of a group purchasing organization is not a new idea. GPOs have been helping businesses save money for decades, combining the buying power of the group to save the individual company money, improve Vendor Contract Management. Where most of them fall short is in simplifying the process for the folks buying the actual products. The typical GPO negotiates pricing and either forces their membership to contract directly with those vendors under the “GPO terms” or provides its membership with affiliate codes to use with multiple vendors to get the negotiated pricing.

Both of these solutions are littered with flaws. In the first case, as discussed above, it is costly to contract directly with the vendors when considering the time and legal expenses. In the second case (which also frequently applies to the first case), there is no control over the pricing the membership is paying. The membership is paying what they think is negotiated pricing, but because the membership is buying the products through the vendor’s website, the GPO has no control over the prices actually paid. Additionally, good luck getting everyone to go to 20, 30, or even 40 different websites (or paper catalogs) to buy through the preferred vendors. Coordinating access and buy-in across 100 properties is a monumental task.

The idea behind Purchasing Platform came about to solve this problem. Our mission? To simplify and save. Period. We set out to improve vendor contracting for property managers and the corporate office. Here is how we did it:

How to Improve Vendor Contract Management 

  1. Host catalogs on our servers to lock down pricing
  2. Centralize all vendors into one marketplace with a single checkout
  3. Highlight ‘core products’ (aka best deals) in search results
  4. Offer order approval workflows to keep spending in check
  5. 100% transparency – no ‘smoke and mirrors’ here
  6. Track in detail all purchases on our platform (Accountants love us!)

With an easy-to-use website, powerful controls and detailed reporting, we’ve simplified vendor contract management so you can focus on growing revenue. Reach out today for more information.

 

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