Procurement Outsourcing; “The Next Great Thing” … again.

Savings continue to be made and realized on bottom lines at leading companies through the utilization of Third Party Services.  There was a time when Procurement Outsourcing was regarded with much distrust by a lot of companies and CPO’s felt that outsourcing prevented the function for acting in a more strategic way.  Now procurement organizations at leading companies are increasingly convinced that there is a way to make outsourcing work for them.

Procurement Outsourcing is a value-added, strategic sourcing of materials.  When considering outsourcing, companies need to think differently about what procurement is and how it should be used.  The procurement outsourcing group will work with the client supply chain team to develop successful strategies that align with the client company’s objectives.  This partnership improves the performance of the chains operations, as well as cost efficiencies.  The client company then has a greater opportunity to focus on business growth.

Packaging is an area where procurement felt it could use outsourcing to take out cost.  However, there is no “one-size fits all” approach.  This is where distribution comes into play.  Packaging Distributors are a great option for procurement outsourcing, especially for smaller business under $200mm in sales.  As an extension of their client’s in-house procurement and their client’s warehouse, packaging distributors provide the scope, scale, and expertise of the packaging supply chain to the clients operations.

Distributor’s services include:

  • Stock and Custom Product Sourcing,
  • Supplier Negotiating and Benchmarking,
  • Warehousing/Inventory Management,
  • Supplier Qualification and Management,
  • Procurement Operations,
  • Category Management,
  • Supplier Performance,
  • Contract Management,
  • Freight/Logistics Optimization, and
  • Competitive Validation.

Is a Packaging Distributor right for your company as your outsource of packaging?  If it can help achieve savings, perhaps there is no reason why it should not be embraced.

 

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