You're struggling to optimize cost efficiency with suppliers. How can you negotiate better terms?

En mi experiencia, para negociar mejores condiciones con los proveedores y optimizar la eficiencia de costos, es crucial adoptar un enfoque basado en la colaboración estratégica. Comienza con un análisis detallado de la cadena de suministro, identificando áreas de mejora y oportunidades para la reducción de costos. Fomenta relaciones de largo plazo y explora contratos de volumen, pero también considera la diversificación para evitar dependencia excesiva. La transparencia en los costos y una comunicación abierta facilitan acuerdos justos. Finalmente, la innovación en procesos y tecnologías puede generar valor añadido, beneficiando a ambas partes.

Besides, having a deeper understanding of your needs makes it easier to discuss indirect costs with your supplier, mitigating price increases by considering the total cost of ownership (TCO). For example, understanding flexibility in delivery schedules can generate significant reductions in logistics costs, or even understanding the impacts of taxes on your company's bottom line can help you discuss alternatives to reduce the cost impact. Direct costs can also be optimized when you have a better understanding of your needs, for example when you work with the supplier to change raw material specifications.

Understanding needs includes answering the question, "What is in it for them?" Every time you sit across the table at a negotiation event, remember that the other party also needs something; what is in it for them?

Go overboard with this step, and explore all possible suppliers and customers. Find out which business sectors the product or service has the greatest supply impact on, and then benchmark to understand how the procurement folks of these sectors negotiate (what are their vendor list, the pricing model, payment terms, stocks, inventory strategy,...).

A good SRM strategy always brings significant results, whether through transparency in communications, prioritizing better commercial conditions or working together to create cost reduction alternatives.

Agreed, long-term relationships with suppliers can lead to more favorable terms over time. The key is to ensure that changing priorities are communicated over time and that the relationships are assessed consistently using agreed-upon metrics, KPIs (Key Performance Index), forecasts, mutually beneficial projects, OTIf (on-time-in-full, a type of KPI),..., in essence, metrics that have been mutually agreed upon.

Construir relaciones a largo plazo con los proveedores es una estrategia clave para lograr términos más favorables. Al establecer una base sólida de confianza, mediante una comunicación abierta y el reconocimiento mutuo, se cultiva un entorno en el que los proveedores ven a su empresa como un socio valioso y confiable. Esta dinámica puede motivarlos a ofrecer mejores precios o condiciones, entendiendo que la relación beneficia a ambas partes. En supply chain, las negociaciones exitosas no se limitan a acuerdos inmediatos, sino que se enfocan en alianzas sostenibles que impulsan el crecimiento mutuo a largo plazo.

Options give one leverage, be it in negotiation, contingency planning, or ensuring the security of supply. The key is to ensure that you consistently order materials from key and alternate suppliers. If it takes a long time to order from an alternate source, the alternate supplier may have changed their processes, shifted manufacturing locations, discontinued the product, or improved the raw material. These changes often lead to changed specifications. The key is to have consistent orders, even small ones, to keep the material top-of-mind for all parties.