Best buys via e-Marketplaces

"Best buys" are in for 2006, and it’s the common statement you’d hear from almost all marketers, specifically those eyeing "value-for-money" deals. With prices on the upsurge, consumers have no option but to face the intricate challenges of maximizing their funds’ worth, especially when it comes to tighter budget management.

Within the traditional purchasing arena, here’s how "best buys" may be defined: (1) Meeting an identified savings range depending on the complexity of an item; and (2) Soliciting an improved offer from suppliers as larger volumes are consolidated. This theory, however, is not firmly validated until after a selected supplier has fulfilled the full terms in a contract. The term "best" may cover an end-user’s final comment based on a requisitioned item, or it may alleviate part of an inventory group’s efforts to trigger request forms before their stacking ratio hits critical. And when coordination happens within a dynamic marketing group, for instance, "best" may also connote responding within "seconds" when an entire promotional plan is altered altogether. To some, "best" may equate to promotions, or simply getting a good pat on the back after the delivery stage.

Within e-Marketplaces, "best" can be objectively defined during each stage of the buying and selling process. Over and above outlining traditional schemes of an enterprise’s identified savings or cost-avoidance range (i.e., getting a specific product or service at lower than prevailing market prices) and pricing discounts via consolidation, one could be an expert in assessing the quality-savings gap for items or services needed. Simply put, this covers the degree of responsiveness to how quality is compensated for every amount of peso saved in the buying process. While an observer, for example, might be satisfied achieving desired savings and/or cost-avoidance numbers, there are certain facets that are also being compensated before an actual decision is made – product quality could deteriorate if prices continue to fall, or delivery prioritization could suffer if suppliers operate below their break-even charges. Others may also correlate the amount of time spent before they effect a decision, especially when repetitive negotiations run parallel to the peak of seasonal variables.

Another feature of how "best" is achieved via e-Marketplaces is through an effective analysis of price discounts vis-a-vis volume. This entails pinpointing an optimum price-volume mix as suppliers give discounts, and the multiples that follow based on "desired" per-unit pricing for every additional item above the minimum bulk order. Lastly, "best" in e-Marketplaces is achieved when transparency becomes more visible via documented and integrated coordination among various departments. Decision-makers could readily create an appropriate mechanism to check who should specialize in accreditation, who should focus on the negotiation, and another body that could weigh the merits when goods or services are finally utilized by end-requestors/users.

By "best," perception of "cheapness" becomes relative. What counts most is the role that the business community should fulfill when the bitter pill of price increases need to be effected, through an appropriate balance of demand and production requirements. This can only be achieved when the members of an enterprise are given more room to make their assessments, and veer away from clerical tasks. On a macro note, economic growth is not only happening in the Philippines, but among our regional peers as well. Living up to the challenge of a more competitive business environment becomes easy if adequate preparations are made, especially in befriending technology that ultimately contributes to bringing out the "best" in people resources.

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Maritel M. Atienza is the assistant general manager of SourcePilipinas. For your queries, e-mail her at [email protected].