Indirect spend is getting a lot of attention lately, as cost reduction is a key strategic priority for businesses worldwide. As we’ve shared before, not using a GPO for certain indirect spend categories is the same as leaving money on the table. But, exactly how much money are we talking about? And, perhaps the better question is: how can you avoid leaving that money on the table?
According to The Blur Group, about $2.28 trillion worth of indirect spend is wasted each year. The cause is often inefficient processes, unnecessary internal management, wasteful spending and procurement fraud. And with this information, it’s no surprise that procurement is re-evaluating their indirect categories like office supplies in search of new opportunities to drive additional value and cost savings for the business.
So, how can you stop leaving money on the table? In a recent post titled, “Indirect spend: 4 tips to avoid leaving thousands on the table,” Corcentric shares tips to help businesses do just this. At the top of the list is to aggregate indirect expenses company-wide.
Aggregating your indirect spend internally is a great starting point. You can even take it a step further, and aggregate your indirect spending with other enterprises to leverage greater purchasing power by purchasing through a GPO.
Other tips outlined in the post include:
- Educate employees on indirect spend
- Strive for centralization
- Make it automated and holistic
Read the full post on Corcentric’s blog for a detailed explanation on each of these tips.
OPTIMIZE YOUR INDIRECT SPEND
Tackle your indirect spend this year to stop leaving money on the table, category by category. Learn how you can easily improve your office supplies spend through our leveraged program.