That probably got your attention fast but unlike the Ginsu knife commercial (I know I’m dating myself), this may not even cost you $29.95. Group Purchasing Organizations (GPO) got a bad rap in the early days and I did my share of the rapping against them at conferences. They have made significant progress and should be considered a viable component of your strategy. At minimum, not considering them as an option is not an option. By the way, we do partner with one of the biggest GPOs but this is not about them so it’s not a commercial (although I am using their information as an example 😊). Here are the questions we pose to executives and see what your response might be:
- Would you like to achieve Category Management for many of your indirect and/or direct categories?
- Are you absolutely positive that you have the best pricing / maximum leverage for your categories?
- Would you like to develop Category Management competencies within your company?
- Would you like to free up your resources to focus strategically?
- Would you like help in enhancing your current infrastructure (process, tools, technology) for Category Management?
- Would you like access to Next Practices (IP, market intelligence, other CPOs, etc.) for Category Management?
- Would you like to accelerate benefits for your Stakeholders?
- Would you like to enhance the credibility of your function?
- Would you like to be acknowledged as a strategic Business Partner by your Stakeholders?
While you may think most of this is marketing hyperbole, I can assure you that it’s not. I have been able to respond to each one of these in our discussions. And just imagine even if half of these are true and a GPO is not even part of your consideration?
But wait – I have even more (I told you it is better than the Ginsu commercial). Would you be surprised if I told you this:
- Agreements that deliver not only cost savings but also higher quality and delivery
- Access to world class contracts / significant reduction in risk
- Your leverage will decrease over time – ours will increase
- Savings will be faster with a longer shelf- life
- Access to world class suppliers who have been vetted and vetted and vetted
- Benchmark savings & buying patterns across members to expose opportunities
And again, all of these are true and totally defensible but imagine if only half were. Would a GPO not deserve to be considered? Not convinced yet – okay, there’s more. How about these kinds of savings:
Now your results may vary but imagine all the time, effort and resources that you have doing these categories who can be redirected to more strategic work. And the reason that the GPO can achieve these types of savings is because of the following :
You and I can never, ever replicate that kind of leverage. So, give this concept a fresh look by contacting us and we can provide you with some free Opportunity Analysis on 2-3 categories to let you take a sniff test – I promise, it doesn’t hurt 😊.
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