Even the digital boffins still use office products from time to time. As office supplies are being used less most businesses should expect to reduce spending over time.
A lot of businesses still place a lot of importance on office supplies as part of an overall procurement strategy. This is not always due to spend. It may be one of the areas where rogue spend and compliance are an issue.
We often see this category open to gaming and on/off contract tactics. Suppliers use various methods to win business and claw back margin later. Those businesses that persist in using an RFP to determine suppliers leave themselves vulnerable to such methods and tactics. This should be a warning sign to business using this approach in this category. They are unlikely to get the best result or derive the best value.
Sign on bonuses are an up front payment from the supplier for awarding the contract. There is no such thing as a free lunch. The supplier will re-coup this cost through higher margin over time. Even worse, a sign on bonus may lock you into unfavourable terms and volume commitments.
Limited contracted basket
Offering a saving on the top items you buy means you are paying full whack for the rest. This flawed method aims to provide visibility on the items you buy most. What it usually does however, is remove visibility to the majority of items you buy. It is on these items that you end up paying more than you should.
Pack size confusion
It is common for different products to come in different pack sizes. Then there are different pack sizes in individual packages (e.g. 12 vs 10 pens). There are also bulk packs for many products to consider. Some suppliers may take advantage of the confusion created by this level of detail.
A cheaper alternative
This involves replacing premium or branded product with a cheaper product. Generic brands may offer valid ways to save over branded products. They may do a similar job but may not always deliver the same result.
It is a challenge for many suppliers to maintain adequate stock levels. When stock runs out, an alternative product to meet immediate demand may be supplied. Sometimes the alternative product also delivers the supplier a higher profit. This type of predatory behaviour is more common than many would expect.
Consider a more structured approach which delivers cost savings over time. The lowest basket price on a small range of top spend items at the time of consideration is a traditional but diminishing return approach that may reduce overall value.
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Office supplies are a necessary expense but there are many opportunities to save.
You should choose a provider that offers: