10. Purchasing

Buying power

In the daily drive to improve sales, it is easy to forget what a powerful impact your purchasing has on bottom-line profits. Yet, for many businesses, a 1% cut in costs can have the same impact on profit as a 10% increase in sales.

By analysing and organising the way you make purchases, you can stem the unnecessary flow of money out of your business, letting you put it to better use.

This briefing looks at:

• A co-ordinated approach to purchasing.
• Drafting the spec.
• Finding a supplier.
• Managing stock.
• Supplier relations.

Not just the right price

Negotiating a purchase can often be more critical than negotiating an individual sale. Apart from price, you may need to secure strategic essentials such as component quality and continuity of supply.

Good preparation, clear objectives and an awareness of common pitfalls are all you need. They will remove the need for inspiration or dazzling technique and provide the basis for purposeful, successful negotiation. (See Negotiating a sale, SE 1, for the view from the other side of the table.)

This briefing covers:

• Setting your objectives.
• Understanding the seller.
• Making concessions.
• Getting the right price.