Source One's series for keeping up with the most recent highlights in procurement, strategic sourcing, and supply chain news week-to-week. Check in with us every Monday to stay up to date with the latest supply management news.
5 Key Factors to Consider When Conducting a Supplier Evaluation
Chris Feldsine, Thomas Net, 7/26/2018
Behind a successful business you often find a strong supply chain serving as its backbone. Proper supplier relationships lead to high product quality, targeted production timelines, and minimal operation costs. The key to maintaining strong relationships is ensuring that your supplier is the best choice for your company, meaning you need to evaluate the supplier's performance on a regular basis. Areas such as capacities, delivery strategies, technological resources, and general business practices are ones that should be aligned with your organization to confirm shared priorities. Successful evaluations and supplier selection can help reduce your company's risks, improve operation visibility, and generate a greater value for products and services.
Procurement's Guide to New Digital World Terminologies
Dennis Bouley, My Purchasing Center, 8/2/2018
In today's constantly evolving world, it's hard to keep up with all of the technological advancements, let alone the terms people use to talk about them. In any business, it's vital to be well-versed on the latest trends and topics, being able to participate in any discussion. While the definition of something may seem obvious given its name, there is often more than what meets the eye, meaning you should have an understanding of the capabilities and categories of the various technologies out there rather than just familiarizing yourself with the names of such. For example, blockchain is not just a chain of blocks, and digitization and digitalization are two different concepts.
U.S. Companies Improve Working Capital Performance- But Is It at the Expense of Suppliers?
Sydney Lazarus, Spend Matters, 8/6/2018
A study from The Hackett Group discovered that U.S. companies' working capital performance has reached its strongest since 2008. While this is a great improvement, it does not tell the entire story; companies are often shifting the burden of their working capital on to their suppliers. They are able to do so by extending payment terms and the average days payable outstanding in 2017 was 56.7 days, 3.4 days more than in 2016. The main metrics analyzed in the study were cash conversion cycle, and days sales, inventories, and payables outstanding. The main strategy identified is to hold back payments to suppliers, extending the payment term. This hampers the suppliers, particularly in their day sales outstanding performance, which has now reached a decade-high amount across companies nation-wide.