The relevance of tail spend, the consequences of mismanagement, and well-managed tail spend have been covered in this series. This time, we’ll examine if catalog procurement help manage tail spend.
As organisations tighten tail-spend management restrictions, non-strategic money is channelled to procurement catalogues, most of which are online service solutions.
This purchase approach is popular because:
- It offers a large selection from pre-approved providers.
- High control and visibility are easy to obtain.
- Staff in many departments may identify, order, and get their needs without the help of busy, expensive procurement professionals because these systems are mostly self-service and easy to use.
However, catalog procurement cannot contain all the items needed by people in different tasks in different firms and industries.
The hardest part of tail spend management. Staff will struggle to discover what they need and may be inclined to cheat the system and use eBay, Amazon, or local sellers, especially if the need is urgent and they are under pressure.
Most control, visibility, and competitive price pressure are lost after this. Companies are increasingly using a spot-buying service with an easy-to-use interface and procurement consultants with subject matter expertise to reduce prices.
This tail spend control service can replace catalogue shopping, operate with it by just buying non-catalog items, or even have its own catalogues, providing users a one-stop solution. Simfoni has all these choices. Our self-service e-marketplace, Purchasing Platform, includes over 1 million basic, regularly purchased items at prices that beat most large brands. We also use Vitesse, our tactical buying solution, for non-standard, custom, one-time, etc. spend.
Procurement catalogues can help tail spend management if their limitations are recognised, the right catalogues are used and maintained, and a contingency plan is in place for urgently needed or unlisted items.
