You require a long-term plan to guarantee the timely supply of goods and services for an uninterrupted journey to fulfilling organisation goals. No wonder, procurement planning becomes crucial to your companys overall strategy.

The process of putting together a productive system to streamline and improve sourcing is known as procurement planning. While larger corporations have a big team to manage this, MSMEs find focus on fire-fighting to get urgent and important procurement without building a comprehensive and efficient procurement management strategy.

??The eight steps listed below should be followed when creating your procurement strategy. Be mindful to modify these steps to fit your specific procedures. Additionally, you should put additional steps or actions into place in accordance with your needs.

1. Examine spending

Analyzing your current spending should be the first step you take when creating a procurement strategy. This will give you insight into your current spending patterns, allowing you to spot areas that are frequently neglected and where you can make savings.

Additionally, this information will serve as the cornerstone of your procurement strategy and give you a clear understanding of what to anticipate from your prospective supplier.

2. Identify needs

Next, one or more members of your company (e.g. the procurement team) must identify and formulate a need for products or services. This need must be analysed and confronted with the requirements of your procurement process. This a key factor that you must consider when choosing suppliers in order to guarantee cost savings.

3. Research the market

After determining your needs, you must now have a general understanding of the state of the market through an external analysis. Undertake a SWOT analysis synthesising your Strengths, Weaknesses, Opportunities, and Threats by combining external and internal analysis. However, depending on the sector of business you are in, market conditions could change frequently. Therefore, it is advised to ensure that the data you gather is consistently updated and remains current over time.

4. Establish attainable goals

Setting goals is the next step after determining your needs and finishing an external analysis of your market. Your procurement strategys needs can be identified using the data you gathered in the earlier steps, and these needs can then be prioritised in accordance with their level of importance.

5. Follow the rules for procurement

Following market research and goal-setting, you must now compile a list of practises you can use to enhance your current procurement procedure. It is advised that you review your current procurement policies and modify them to meet the demands of your company as they currently stand, as identified in the preceding actions. Everybody involved in the procurement process should use the procurement guidelines because they provide solutions to potential problems.

6. Employ a specific tool

Multiple steps in the procurement process must be carefully followed in order to prevent errors that could cause delayed payments. As it is time-consuming, managing it can be challenging. However, by removing manual data entry and related inefficiencies, you will be able to increase employee productivity and decrease errors. Organisations of any size can set up and manage procurement procedures in an intuitive interface with enterprise management software like Procure Pro.

By directing purchases to approved suppliers and pre-negotiated contracts, this can reduce errors, save time for employees, and cut costs.

7. Establish and carry out the Procurement strategy

The objectives of your procurement strategy are determined in the next step, along with the tactics that will be employed to carry them out. Once your procurement strategy has been put into practise, you will then have more time to devote to strategic aspects of procurement and ways to improve supplier relationships rather than time-consuming administrative tasks.

8. Customize the plan to your needs

After developing and putting into practise your procurement strategy, the last step is to monitor and assess its success and pinpoint areas that could be improved going forward. Other departments that are involved in the process, like HR, production, administration, sales, or finance, for instance, will need to participate in this.

Looking for the right combination of technology and customer service? Think Us! We’re net beneficiaries. We are specialists in B2B packaging and procurement, offering end-to-end solutions for uncharted business growth. Click here to inquire!