In challenging economic environments, organizations need to be smart and strategic about how they spend money. This is especially true when it comes to procurement of maintenance, repair, and operations (MRO) supplies and services.
Key Trends Shaping MRO Procurement
With economic headwinds on the horizon, procurement groups must pursue strategies that balance cost control, supply continuity, and emerging imperatives like sustainability. The trends we see shaping 2024 priorities include:
- Laser focus on reducing spend
- Ensuring supply assurance
- Embedding ESG into sourcing
- Unlocking value through digital transformation
- Leveraging AI and advanced analytics
Leveraging Collective Buying Power through Cooperatives
One innovative approach that is gaining traction is participation in cooperatives that aggregate spend across many organizations. SDI’s Supply Chain Cooperative provides members with significant benefits by leveraging the collective buying power of the group. Read How Digital Purchasing Cooperatives Unlock New Value from Indirect Spend.
By aggregating demand across multiple companies, Group Purchasing Organizations (GPOs) like SDI’s Supply Chain Cooperative, can negotiate better contract terms, pricing, and service levels from suppliers. This translates into significant cost savings that can boost participating companies’ bottom lines.
These benefits include:
- 20% Cost Savings: Members can take advantage of negotiated pricing and discounts from suppliers, reducing overall costs for MRO supplies and services by an average of 15-20% — at no additional cost to members.
- Streamlining: The administrative burden of MRO procurement is reduced through consolidated contracts and simplified procurement processes. This frees up time and resources.
- Supply Chain Optimization: By identifying and addressing inefficiencies, delivery of MRO supplies can be faster and more reliable. Supply chain resiliency improves.
- Collaboration: Members connect and share insights, best practices, and the latest innovations in MRO management.
By participating in SDI’s Supply Chain Cooperative in 2024, organizations can tap into these substantial benefits and dramatically improve their MRO procurement strategies.
Additional Benefits of the SDI Cooperative Model
Beyond the core benefits outlined above, the SDI Supply Chain Cooperative offers characteristics that set it apart from traditional purchasing consortiums:
- Supplier Diversity: They maintain a minimum of 3 suppliers per category to encourage competition, top-notch service, and maximum value. Suppliers adhere to ESG and DEI standards.
- Expert Guidance: Members can leverage SDI’s 50+ years of experience to further optimize their MRO spend and supply chains.
- Innovation: Access to powerful analytics provides visibility into spending behaviors and patterns. The upcoming digital platform promises additional innovations.
- Flexibility: Membership terms are flexible – join or stop any time. Buy as much or as little as needed from each category.
Read more about Maximizing Maintenance, Repair, and Operations (MRO) Procurement: GPOs vs. Purchasing Cooperatives
Strategic Best Practices for Procurement Excellence
In addition to participating in cooperatives, organizations should incorporate strategic best practices into their procurement strategies:
- Leverage total cost of ownership models to evaluate true lifetime costs.
- Strengthen supplier relationships through collaboration and communication.
- Conduct scenario planning to identify risk mitigation strategies proactively.
- Diversify supply base to reduce over-dependence on single sources.
- Analyze spend data with analytics to uncover savings opportunities.
- Implement technologies to streamline processes and gain visibility.
The Time is Now
With rising costs and economic uncertainty, organizations simply cannot afford to leave savings on the table when it comes to MRO spend. Partnering with SDI’s Supply Chain Cooperative should be a top priority for supply chain leaders seeking to implement a forward-thinking procurement strategy in 2024.
The collective power and expertise of the Cooperative provides the leverage needed to drive substantial savings and supply chain improvements without large investments in time or infrastructure. Combined with strategic best practices, organizations can maximize value, efficiency, risk mitigation and savings. The time to take action is now. Schedule a call with a Member Representative today to learn more.