PRESS RELEASE – October 18, 2022.- The procurement function is playing an increasingly important role in the overall strategy of companies as it helps to address objectives that are becoming more complex to manage and more demanding in terms of deadlines and cost savings. Likewise, new procurement models must comply with a responsible management plan under strict sustainability principles for their entire sphere of influence, both external and internal.
In this context, the outsourcing of the procurement area has become one of the options most in demand by companies in recent years, with the aim of being able to convert certain fixed costs into variables and to be able to focus efforts on the management of strategic procurement. Data from Fullstep, Fullstep, a company specialized in the end-to-end DIGITALIZATION of the procurement, sourcing and supply chain process, show how outsourcing of procurement in their company has grown by 75% in the last 3 years and forecasts indicate that in 2022 it will grow by an additional 50% compared to 21.
“This area currently accounts for 40% of our turnover. Outsourcing is the perfect solution for dealing with this changing situation. Many companies had not worked until now on the professionalization and DIGITALIZATION of the procurement area. Therefore, having a reliable external partner allows you to have the know-how and cutting-edge technology in a safe and fast way”. explains Rosario Piazza, CEO of Fullstep.
Outsourcing procurement operational services helps companies save up to 25%.
The lack of talent and professionalism, time and technology needed within companies to manage the procurement area has led to a greater reliance on Business Process Outsourcing (BPO) for procurement. This role has begun to evolve and undergo a great change, growing exponentially over the last 5 years, despite the fact that this service has been in existence for more than 30 years.
Companies are looking for solutions that allow them to save and put a greater focus on core procurement, and reduce time and effort on those procurements that bring less value to the business. “Outsourcing operational services helps to meet all these objectives. In the last year alone, our operations area, either through BPO, implants or category management, has carried out negotiations for a volume of €5,000M for our customers. And thanks to this service, companies can reduce their costs by 18% to 25%,” explains Piazza.
Procurement BPO, the self-financing player for SMBs and key accounts
The procurement BPO covers a large part of the current challenges in this area of the business, being a profitable option for companies of any size and sector of activity, thanks to the know-how, specialization and access to technology that it offers. The implementation of a procurement BPO service brings benefits from day one, being even more remarkable after a period of between 5 and 6 months, with an ROI of between 150 and 300% due to improved prices and conditions with suppliers, optimization of resources and reduction of execution times, according to the latest data collected by Fullstep.
In addition to the return on investment of hiring a procurement BPO, this is a gateway to specialization and digitization of the area for both large companies and SMEs. “Large companies make requests of between €25,000 and €200,000, with a focus on fast execution, savings and improved conditions or fast track. And they also demand the centralization in a third party of the issuance of orders and their follow-up. In the case of SMEs, they demand procurement and minor procurement services, including invoice and payment management. And non-strategic procurement services, in fast track mode, and other operational tasks such as, for example, supplier approval, are on the rise,” explains the CEO.
In short, relying on a BPO in procurement helps companies to move forward quickly and safely in the optimization of procurement, regardless of their size, in order to face the current market instability with resilience.
