The business community has long recognised the economic advantages of consolidating spend to reduce vendor numbers. Working with GFI, with our global coverage, and multi-discipline capabilities (electrical and mechanical) guarantees clients improved efficiency and profitability in this respect.
In addition, we offer an effective extension to our client operations, to supplement their finite in-house resources, and allow them to focus on areas of maximum benefit. According to the Pareto Principle, there is an 80/20 ratio: High volume purchases (80%) are usually the low value (20%) of the total money spent in purchases. Accordingly, low volume purchases (20%) equal high value (80%) of expenditures. By using a Purchasing Company for 80% of the orders (accounting for 20% of expenditures), companies save time and money. It is the same as sub-contracting for production, accounting, logistics or other services.
Small value or urgent orders are a crippling problem in today`s fast paced business environment. We will save your operation from sizeable losses during equipment breakdown, special projects, or shut down situations, by finding and delivering the parts and supplies you need in the shortest possible time frames. Our online Order Tracking allows you to monitor the status of your multiple orders from purchase order placement to delivery.
Single Source Savings: Examples
Engineers time to gather information from prospective manufacturers and select the best option for the application. Communication costs for the engineer to interface with manufacturers or other suppliers.
Purchasing staff time to place the purchase order with the chosen supplier, and associated communication costs. Purchasing staff time used to expedite the purchase order, and associated communication costs.
Payment costs. When buying from multiple vendors, buyers may be forced to make advance payments. Regardless of this, with a multiple vendor strategy, individual bank charges will be incurred for each order.
Currency risk costs. When sourcing from overseas vendors, buyers can be open to the risk of currency fluctuations for long periods of time if suppliers do not quote in their preferred currency.
Logistics staff time. When dealing directly with multiple overseas vendors, end users have to organise and co-ordinate international shipments, and incur the associated communication costs.
International shipping costs. When using multiple vendors, each purchase order will incur individual shipping costs. When shipping, the greater the weight shipped, the lower the cost per kilo.
Transit insurance costs. When using multiple vendors, buyers pay individual insurance costs on a per order basis. This costs time and money.
Import costs. When placing multiple orders with multiple vendors, buyers incur individual import costs for each purchase order.
Accounts payable staff time. The more vendors you use, the more time it takes to process and instigate payments.