Just as landscapes need pruning to thrive, consolidating suppliers can focus growth in the right direction. Multifamily housing professionals gain efficiency when they pare down underperforming suppliers and focus on a core of high performers.
When done right, supplier consolidation can reduce costs, save time and improve relationships with existing partners. When paint doesn’t arrive on time, there’s a leak in 504, and you need to source roofing, having fewer trusted suppliers enables you to focus on your most pressing needs.
Keep reading to learn more about the benefits of consolidating your suppliers.
Supplier Consolidation Made Easy
Supplier portfolios can creep into inefficiency over the years; trimming them down doesn’t have to happen overnight. Take a patient, step-by-step approach to supplier consolidation.
Start with a holistic assessment of your current suppliers. Price is important, but low cost doesn’t always win. Other factors include available inventory, good communication, product quality, and shipping reliability. Use the pruning process to focus on core suppliers who always seem to come through for you. Work with them to be certain they’ll offer better pricing with higher spend volumes.
- Are you sourcing comparable products from different suppliers?
- Can you negotiate lower shipping costs by consolidating?
- Which suppliers solve problems with the right products at the right time?
- Focus on suppliers willing to grow and flex with seasonal needs.
- Get input from your team, including front-line staff.
- Small teams can pilot-test minor changes, measure the results and roll successes across the organization.
Weigh Benefits Against the Risks
"Setting up individual accounts, especially for one-off contracts, is time consuming. Time is valuable in this business. Fewer trusted suppliers covering more aspects of our business are a key to saving time.”
- Kimberly Malcolm, Regional Director of Multifamily Housing at OMNIA Partners.
Done incorrectly, consolidation may also reduce flexibility and introduce expensive supply disruptions. It’s a matter of finding a balance and the right partners. A core group of suppliers who are reliable and transparent enables both parties to mitigate risk and find mutually beneficial opportunities.
Your Advocates in Group Purchasing
If you need to evaluate or find new suppliers, a well-established group purchasing organization (GPO) offers immediate access to a broad catalog of suppliers and contracts. If something goes wrong, the GPO team is an extra layer of support for elevating service requests. Using the DIY approach to managing multiple suppliers takes time and introduces risk. The right GPO allows multifamily housing professionals to streamline operations and drive efficiency.
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- Procurement
- , Real Estate