Non-inventory, off-contract, and non-core purchasing can greatly benefit from being tendered out through a structured procurement process. Here are some key advantages:
- Sneaking Under the Radar: When times are good, the purchasing of all these accumulates to form a significant potential drain of net profitability. They often grow unchecked until times are harder, then the rude shock occurs once tallied.
- Quality: With multiple suppliers bidding, there is an opportunity to assess the quality of goods or services. The right tender process allows for a simple and fast evaluation of proposals, ensuring that the chosen supplier meets both quality and budgetary needs.
- Cost Savings: Tendering out such purchases can drive competition among suppliers, helping organisations secure the best pricing for non-inventory items like office supplies, cleaning, utilities or services that aren’t tracked for quantity. It frequently results in better deals compared to direct purchases.
- Keeping the Current Suppliers Honest: The tender process ensures a transparent and fair selection of suppliers. By clearly defining requirements and evaluating proposals against set criteria, organisations can avoid favouritism and ensure that all potential suppliers have a fair chance to compete.
- Risk Management: Tendering off-contract purchases helps manage risks by securing fixed terms and conditions for the supply of goods or services. This reduces the likelihood of unexpected costs or supply issues over time, offering more stability in the supply chain.
- Innovation: purchasing non-core and non-inventory products and services through tendering allows prospective suppliers to showcase any new innovations that can benefit your organisation as they attempt to gain preferential supplier status.
By leveraging tendering for these types of purchases, organisations can achieve cost efficiency, improve quality control, reduce supply chain risks and ensure more strategic use of resources.
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