Purchasing is essential for an organization's engagement, as it involves the acquisition of goods and services. In this article, we explore the importance of purchasing indicators in the effective procurement process. We will present examples of indicators and discuss how they can be used to improve the performance of the purchasing area. Discover how purchasing indicators can boost your company's efficiency.
The Importance of Purchasing Indicators
To ensure an efficient purchasing process, it is crucial to have indicators capable of evaluating the performance and efficiency of a company's purchasing department. These indicators provided valuable insights and helped us identify opportunities for improvement. Furthermore, they help us make strategic decisions to effectively manage the process of acquiring goods and services.
Examples of Purchase Indicators
There are several types of purchase indicators that we can use. Below are some examples and their specific characteristics:
- Cost savings: This indicator allows us to measure the amount of money saved through the purchasing process. We can calculate this by comparing the cost of goods or services purchased with the cost of similar products from other suppliers. For example, by comparing the cost of materials purchased from a preferred supplier with the cost of similar supplies from other suppliers, we can determine cost savings.
- Order fulfillment rate: This indicator allows us to measure the speed at which we fulfill purchase orders, that is, the time it takes for the supplier to deliver the requested product or service.
- Customer satisfaction index: Assessing the level of satisfaction of internal customers (company employees) with the quality of products and services purchased by the purchasing department is fundamental.
- Supplier turnover rate: This indicator allows us to measure how often we change suppliers, which may indicate quality problems or a lack of stability in supplier relationships.
- Level of supplier diversification: Quantifying the number of different suppliers used by the company is important. Low diversification may indicate excessive dependence on one or a few suppliers, which can be risky in case of problems with those suppliers.
- Supplier performance: Evaluating supplier performance based on indicators such as delivery reliability, product or service quality, and response time to inquiries is essential for identifying the best suppliers and building long-term relationships.
How can Artificial Intelligence improve Purchase Indicators?
The Supply Brain purchasing platform uses Artificial Intelligence to automate the quoting and negotiation process, making it agile, transparent, and intelligent. Upon implementing this platform, we observed a 33% increase in cost savings during the bidding process, as well as up to a 154% increase in team productivity.
Automation and standardization of processes also provide a holistic view of information, becoming essential indicators for purchasing management. Furthermore, it reduced the average purchase time by 52%, significantly improving the purchasing experience for both the company's requesters and buyers.
Conclusion:
Purchasing metrics play a key role in evaluating and improving an organization's purchasing area. By using appropriate indicators and implementing innovative solutions, such as the Supply Brain platform with Artificial Intelligence, we can sustain the efficiency and performance of purchasing. It is essential to adopt a proactive approach in defining and monitoring indicators in order to gain valuable insights and achieve desired results.
