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During a BDNY Conference, we sat in with industry leaders in procurement. These giants were asked about industry learnings that they will take with them to 2023. Their answers have been slightly edited for concision.
Every organization is different, and each has its own set of challenges when it comes to procurement. However, there are some things that all procurement leaders can learn from one another. Here are a couple of things that we have learned from the best of the best in procurement.
The past year has been a rollercoaster for logistics, with freight rates from Asia at an all-time high and more stringent ship regulations. It’s important to note that not even industry titans have all the answers.
During the conference, one of the panelists asked the question: “What response can you give to suppliers trying to earn your (procurement) business?”
With which the panel replied with: “Tell the truth.”
“The mantra is no news is not good news. Any news is good news even if its not what you want us to figure. Because if you tell us the truth, we can (generally) always find a way to manage around the delivery issues in order to try and accommodate.”
Transparency has become increasingly important in the current climate of procurement because it allows for better communication and collaboration between buyers and suppliers. When both sides are able to see what is happening in the procurement process, they can work together more effectively to get the best results and can get ahead of bottlenecks quicker. Transparency also helps to build trust, which is essential for successful business relationships.
It’s no secret that hotels took one of the biggest hits during the lockdowns. To save on costs during the pandemic, hotel franchisees had to put a halt to renovation and improvement projects that typically happen every 7 years.
The good news is that the hospitality industry is now in a recovery phase and is now in a position to begin these projects anew. For procurement, this means that there will be an increasing demand for servicing new projects– most likely all at the same time.
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"What we were really talking about is managing expectations. We were talking about how some of our clients expected things to be a certain way and we needed to find a way to explain to them that you cant buy things in 2022 with the same budgets and same prices that they were in 2019. So its really important in a fund to find those high expectations. Expectations that can be found can turn into expectations realized."
Inflation has been on the rise for a few years now, and it shows no signs of stopping. This means that the budgets you were used to working with previously are no longer feasible. In order for procurement businesses to stay afloat, procurement agents need to find ways to work with more money. One way to do this is by finding new sources of revenue. Another way is by becoming more efficient with your spending.
With experience-centric spaces taking the world of hospitality by storm, hotel design has gotten more complex over the years as guests have come to expect more amenities and features. To quote one of the speakers: ”A headboard isn’t just a piece of wood behind the bed anymore. Now, it could be anything, with more components that come with it.”
In order to keep up with the competition, hotels have had to find new ways to stand out from the crowd. This has led to an increase in the number of hotels offering unique features, such as on-site restaurants, spas, and other luxury amenities.
This phenomenon is likely to continue in the years ahead, as guests become increasingly conscious about where they stay. As a result, hotel designers will need to come up with ever-more creative ideas in order to keep guests happy and coming back for more.
As hotels continue to compete for guests through unique designs and new standards, procurement teams will need to be increasingly creative in order to find the best deals and materials.
Procurement teams need to be increasingly detail-oriented when it comes to procuring designs. After all, the success of any project depends on making sure that all the necessary details are accounted for.
"The whole (procurement) industry is becoming much more sophisticated. I think manufacturing is starting to come back to the United States. We see a lot of local companies getting busier with manufacturing."
We've reached a new age of robotic manufacturing, ship tracking, and new supply chains. And along with the growing ecosystem of this industry are people and technology that have become more intelligent and sophisticated over the years to fit the demand. There are more opportunities lurking for those who are willing to learn and grow within the industry.
Reference:
Conference name: Stalwarts and the Supply Chain: How to Conquer Challenges and Minimize Chaos
Speakers:
During a BDNY Conference, we sat in with industry leaders in procurement. These giants were asked about industry learnings that they will take with them to 2023. Their answers have been slightly edited for concision.