Friday 17 October 2014

Spend Management Strategies

Today many businesses are looking to cut costs by reducing staffing and lowering the quality or quantity of products sold. The studies have found that those methods are not a long term solution nor do they lead to growth. Instead, companies those are most successful look for ways to lower costs by finding and cutting unneeded or excess spending and to reducing costs of materials through volume discounts and automation of supply chains. 

The first step in spend management is generating spending and outgo reports for all departments. This allows money to be tracked and ensures that vendors are charging appropriate amounts. If they are not, with spending reports, this can be rectified. Further, this information, when paired with supply chain data, can show which vendors are providing the best prices. Studies have shown that businesses can save up to 12 percent on the cost of supplies by engaging in cost management.