As organisations look to consolidate suppliers, RS Component's Product Plus service offers access to an even greater list of products and parts
Procurement teams are constantly challenged to cut MRO (maintenance, repair and operations) procurement costs, with recent research by RS Components and the Chartered Institute of Procurement and Supply showing that 59% of procurement professionals state that “reducing operational budgets” is the biggest business pressure they face.
Due to the complex nature of procuring industrial supplies, many organisations find that their employees can waste large amounts of time and effort in finding products and then negotiating with suppliers. In addition to sourcing and negotiating, unnecessary costs are also incurred through spot buying, which is when stakeholders make one-off, unplanned purchases of items that are not already catalogued on the customer’s purchasing or inventory system.
By working with a smaller group of trusted suppliers that have a wider range of products, it’s possible to greatly speed up the process time, manage purchase costs and focus the time of engineers and other stakeholders on more value adding activities. With more than 500,000 products stocked and published on its website, RS is in a strong position to supply the majority of MRO parts, and for items not published on its website, customers can access Product Plus.
Product Plus is an exclusive service, which utilises RS’s relationships with more than 2,500 suppliers to offer access to more than a million products. Customers are helped by a specialist team whose role is to find and deliver products. In addition, they will also suggest alternative products to the ones requested if they offer greater functionality and value for money.
“Product Plus is about sourcing premium products from global suppliers at the best possible price for customers, which allows them to maintain their operations while minimising procurement costs,” says Emma Botfield, Managing Director for the UK & Ireland at RS Components. “It’s fundamentally about saving customers’ time – finding non-standard products can take huge amounts of time to source and in many cases suppliers won’t even supply certain products direct to end users.
“Product Plus allows them to save time by letting RS do the hard work in finding products, which lets the customer get on with running their business,” she adds. “In addition, by consolidating more spend with RS it’s possible to increase average order size which in turn reduces the volume of invoices to be processed. By using RS for more of their purchases it’s also possible for customers to reduce the time and money spent managing MRO.”
“Product Plus supports vendor consolidation and lets customers save time, with RS doing the work to find and source products, which means they can get on with running their core business activities”Emma Botfield, Managing Director for UK & Ireland, RS Components
Botfield points out that it is widely accepted that the process costs associated with an individual order is around £80 so consolidating more purchases with RS reduces the number of purchase orders and invoices generated. In addition, companies are able to leverage their spending power, speed up the sourcing process and reduce their total cost of ownership around indirect materials.
“Product Plus is ideal for organisations on a total cost reduction or supplier rationalisation journey,” explains Botfield. “The service is proving incredibly popular with customers who are using it. “We’re working very closely with key partners around supply relationship management to improve our delivery performance,” she adds. “This means that as well as being reactive to customer requests for products, we are also being proactive in ensuring we have the right supply partners in place to meet customer needs in the future.”
RS aims to offer as close to 100% coverage of products customers can purchase as possible, which includes looking at innovations and developing technology. “Product Plus is a great way to introduce brand new technology and products to our customers,” says Botfield.
“From the wider RS perspective, any products that are proving popular with customers can then be added to the core range of products we stock and publish on our website. “We’re always looking for new suppliers and we don’t see country boundaries as an issue – we transact all around the globe to get the products that our customers need.”