Over the last several years, we've all witnessed the public fleet vehicle supply chain become more complex than ever. Blame the pandemic for supply shortages, trade barriers, and inflation adding increasing pressure and complexity to supply chain operations, requiring public fleet directors to unify processes and applications and meet challenges.
Experts call this improved system “supply-chain convergence.” This ecosystem started with transportation and warehousing, later integrating supply-chain planning.
Your next step is converging supply chain & procurement. "This shift will allow companies to build resilience, mitigate supply-chain risk, and drive innovation. Even more, supply-chain convergence represents a fundamental shift in how organizations think about enterprises, changing from discrete entities into elements in a multifaceted ecosystem," states this GEP article in Harvard Business Review.
Fleet operators can use this method to streamline aspects of their procurement process to try to mitigate supply chain issues. More connected procurement processes can ensure resiliency in your supply chain.
Transparency with your suppliers can optimize the relationship and lead to long-lasting collaboration.
The more transparent an organization is in its supply chain, the better its partners can meet demand. Suppliers require data from customers to forecast demand. With this type of planning, suppliers can also ensure tighter controls on forecasts and projections.
Well-priced procurement at all parts of the supply chain leads to competitive pricing.
To ensure an efficient and effectively priced supply chain, procurement professionals need to find partners that can offer them the best deals at every stage of the process. This means working with partners that will both collaborate on demand planning and contribute to competitive pricing.
"To gain a competitive advantage, procurement professionals utilize the external market and suppliers. This means every sourced product, including price and quality, should contribute to competitive positioning," says global manufacturer VPIC.
Effective procurement ensures improved product lifecycle management.
Procurement professionals need to think of their suppliers as partners, which means closely connecting with them about needs, priorities, and shifting demands. Well-chosen supplier partners also can solve problems and shorten timelines.
"There has to be close interaction with suppliers so they can increase capability flexibility to shift between new and old supply chains. And it is essential to leverage suppliers’ capability to drive product innovation and shorten the cycles for product development and commercialization," McKinsey & Company consultants note.
An improved ability to procure necessary materials decreases the likelihood of disruptions.
Minimize delays by developing closer and more reliable supplier relationships. When you share data and design supply-chain improvement projects, you and your partners can avoid the disruptions impacting other supply chains.
"By improving your ability to procure mission-critical materials and products, you can reduce your chances of experiencing a severe and prolonged production disruption. You will be in a better position to capitalize on surges in demand and can enhance the overall purchasing experience for your customers," suggests shipping firm R2 Logistics.
Supply chain & procurement convergence leads to simplified cost management.
When public buyers tracked the costs of supply chain & procurement separately, they unknowingly created inefficiencies because there is so much overlap between the two.
Today's procurement professionals utilize supply chain convergence to better track direct and indirect spend.
"Supply-chain convergence creates a unified view of spend and cost across both procurement and supply chain to enable companies to connect their direct and indirect spend. With increasingly complex supply chains, convergence is the way to enable a view into the end-to-end costs and manage spend more effectively," states GEP Software, Strategy, and Managed Solutions.
Converging supply chain & procurement with cooperative purchasing
Procurement professionals need to develop close relationships with their suppliers for effective supply-chain convergence. Suppliers should be partners, and finding long-term collaborators involves a time-consuming selection process.
Public fleet leaders can decrease the selection time by connecting with Sourcewell. This government organization completes a competitive solicitation process to award suppliers. Then, its partners can search through already existing cooperative purchasing agreements that meet their needs. Finally, you can obtain a quote from the supplier while referencing the Sourcewell contract number.
For example, if a fleet procurement specialist needed to add cameras to their supply chain, they could find a supplier offered through Sourcewell. The benefit is that you don't have to conduct the solicitation yourself. Due to the number of public entities using Sourcewell cooperative agreements, suppliers can usually offer volume-discount pricing.
With a proven supplier partner like Sourcewell, you can spend more time developing partnerships and improving processes in your supply chain.
Here at Sourcewell, we help public agency buyers procure fleet vehicles faster by fulfilling the time-consuming bid process for them. Through cooperative contracts, we expedite the fleet vehicle procurement process so you can better serve your teams.
Want a faster procurement process? Contact one of our specialists today to buy the fleet solutions you need!