Checklist: 4 Important Points to Be Kept in Mind While Conducting Supplier Risk Analysis

Does your business rely on a group of critical suppliers? Any risk to one or more of these suppliers could disrupt your supply chain and affect your overall revenue. For this reason, you need to conduct supplier risk analysis and assessments to keep you aware and updated on any potential risk that any critical supplier could cause. Here are four important points to keep in mind while conducting supplier risk analysis:

1. Collect, centralise and aggregate all the necessary information on your critical suppliers. Have a centralised database of data on your suppliers to improve your efficiency and ensure compliance with acceptable supplier risk analysis practices. Remember to keep the data updated.
2. Look into the supplier's financial health. Do a thorough analysis of every supplier's financial status. Be sure to cover the sustainability performance and the business ecosystem to find out any potential risk.
3. Identify the suppliers that are able to contribute a lot to your business. Different suppliers have different effects on your supply chain. Group them into four categories: critical, strategic, approved, and used. ‘Critical’ suppliers are those that could potentially disrupt manufacturing, delivery, and other operations in your businesses. ‘Strategic’ suppliers are those with whom you have strong, mutually beneficial relationships with and are involved in your business planning model. ‘Approved’ suppliers are those that have passed due diligence but can be replaced without any serious repercussions. ‘Used’ suppliers are low-value entities that never went through formal due diligence and can easily be replaced or dropped.
4. Have a disaster recovery plan in case of supplier failure. Proper planning will protect your business in case a supplier fails to deliver.
   

Outsourcing supplier risk analysis can help you perform all these tasks and can free up some manpower in your company. This way, you can focus on other important aspects of your business, such as increasing your revenue and generating ideas that can help you sell.

Benefits of Proper Category Planning and Management Approach

Having a proper approach to category planning and management is crucial for an effective category intelligence solution. Technological advancements and globalisation have caused supplier business models and procurement category management to evolve fast, resulting in the need for a more pro-active approach to category planning and management that is based on actionable market intelligence.

Your company deals with different suppliers coming from different geographies and industries. Hence, it is essential for your procurement team to possess updated and sustainable knowledge on the continuously evolving trends within every category. With an efficient approach to category planning and management, you should be able to have access to timely and comprehensive insights for creating effective strategies for sourcing. Moreover, you should be able to gain relevant updates on developments in categories, so you can find risk signals and reduce disruptions in your supply chain.

A good category planning and management approach should be able to help your procurement team make efficient and effective procurement decisions. Reputable category intelligence solutions providers can help you with their online sources, expert opinions, and on-ground insights. An experienced analyst team can help you track the best practices and category trends, as well as create bespoke market reports on category leads.

Outsourcing your category intelligence solution will improve the way you plan and manage categories. Once a plan is made and a sourcing strategy has been defined, category managers can closely monitor the variables that can affect the plan, such as the entry of new players, regulatory changes, pricing changes, technological developments, and macroeconomic changes. An effective category intelligence analyst should work as an extension of your buying organisation when monitoring those developments across every category. This way, you have an easier way to filter unnecessary information from relevant news and deliver better insights to category managers through periodic newsletters, annual updates, and sector reports.

What Can One Get from Procurement Consultants in the UK?

Business intelligence is crucial for the success of procurement organisations at leading corporations worldwide and in the UK. To save money and time, these organisations hire procurement consultants when they need to make important decisions based on facts. Procurement professionals can provide high-value and fully customised analysis and research in supply chain and procurement intelligence to help reduce risk and unlock hidden value. Here are some of the things an organisation can get from procurement consultants in the UK:

• Actionable intelligence – Working with procurement consultants can help your business gain the most important information about your suppliers, procurement categories, and supply chains. That way, you can plan and act more proactively. Reputable procurement intelligence solutions specialists provide critical, actionable, and comprehensive information at every stage of the procurement life cycle.
• Access to many information sources and suppliers worldwide – Procurement consultants in the UK have an in-house database of thousands of online information sources and millions of suppliers. Hence, they are capable of generating actionable insights and intelligence for stakeholders like category managers and chief procurement officers.
• Assistance to procurement officers and departments – With procurement consultants, it will be easy for procurement executives to benchmark and measure the performance of incumbent suppliers, detect early warning signs on supply chain risk, track the changes in procurement categories, and meet requirements for compliance when monitoring suppliers. Professional procurement consultants can help procurement officers ensure a sustainable supply chain and establish stronger relationships with suppliers. They may help identify levers for cost savings and negotiations and discover niche and new suppliers.
  

Sustainable procurement intelligence – Procurement consultants in the UK can assess your suppliers' sustainability performance to identify opportunities and risks caused by their social, governance, and environmental performance. Likewise, they can identify best practices for sustainability to help your suppliers improve their performance.