After the excess and celebration of the festive season, January is traditionally a time for cutting back. But for 2010, purchasers are expecting this mood of austerity to last for the next 12 months. “Cost-cutting” will be the main focus for 38 per cent of respondents to the latest SM100 poll, which asked buyers to identify the top priority for procurement in their organisation. With an additional 22 per cent saying their main concern was to get more spend areas under purchasing’s control, the dominant tone seems to be: spend less and control more.
But scratch deeper and a more complex picture emerges.
In any economic climate, cost-cutting will be a top-three issue for purchasing, says Tom Woodham, director of supply chain consultancy Crimson & Co. But this year, he expects cuts will be less of an issue than supplier relationship management. “I think a lot of people have been exposed in terms of supplier relations,” he explains. Although in some cases this exposure has been when the supplier has gone out of business, it has also been the realisation that the supplier is more valuable to the purchaser than the other way around.
