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['Size Does Matters' when it come to The Power of Procurement]

In a globalised market, there is clear evidence from procurement industry leaders and institutions showing that a single-minded focus of an individual business to negotiate and drive down cost across category spends (direct and indirect) and within key areas of flow is ambitious.
On the flip-side, there is ample evidence showing how multi-nationals are using their 'power of procurement' to overcome cross-border trade and behind-the-border barriers to gain a strategic and competitive advantage in the local market. - re: KPMG and CIPS (Charted Institute of Purchasing & Supply) Reports


[The Business Case] Group Aggregated Procurement (GAP)© Program

Unlike 'buying groups' that go to market to negotiate 'a price' for goods and for services for its members (big and small) through a 'Purchasing Plan, HERM Logic GAP (Group Aggregated Procurement) Program is a full service managed program based on our 'profitable partnering framework' to deliver year-on-year negotiated and realised savings at the lowest TCO (total cost of ownership).

Through our overarching strategic sourcing plan/s, aligned business framework/s (ABF) and the aggregation of individual businesses annual spend across direct and indirect categories, we buy for less by overcoming gaps in flow and trade barriers to match the size, the spend and the negotiation power of major multi-nationals.


The HERM Logic's GAP Program currently delivers negotiated and realised benefits ranging from 10% - 35% across purchases, key areas of flow, and value added services from top to bottom line to our Members:
Projects; and/or
Business units; and/or
Organisational profit.


GAP Member Value Proposal

Neutrality is key! At the centre of the GAP Program is the 'Individual Member Agreement (IMA's) Plan/s that delivers confidentiality and power.

The IMA Plan/s leads and supports initiatives to ensure that "all Members" are getting the best value for money outcome across the,

(a) Category Spend/s; and,

(b) Key areas of flow within the Supply Chain;

from our Supply Partners ("GAP Supplier Partnership") to address the unique commercial challengers faced by each GAP Member.




GAP Member - Core Value Benefit

(a) Negotiated and realised savings through 'New GAP
Supplier / Services Agreements' with
1. Current Suppliers; and/or
2. Preferred Suppliers; and/or
3. New Supplies

(b) Supplier Rebates based on Quarterly Spend.

(c) One-Off Joining/Membership Fee, No Ongoing Fees.



Delivering Manufacturing Agility & Competitiveness

GAP Supplier Value Proposal

Building strong relationships with suppliers is central to our ability to create a sustainable supply chain. Without strong supplier relationships, we lessen our ability to encourage and influence the sustainability goals and management processes of our suppliers.

At HERM Logic, we believe that strong relationships with our suppliers must be based on open communication, clear expectations and consistent requirements and processes.

Sustainable Supply Through Aligned Business Framework (ABF)
At the Centre of Aligned Business Framework (ABF) is the commitment by suppliers to manage and assure their supply chain to increase mutual profitability, improve quality and drive innovation, and to help us encourage shared commitment to sustainability goals.


GAP Supplier - Core Value Benefit

(a) Opportunity to align Sales and Operation Planning
(S&OP).

(b) Opportunity to address risk and issues, barriers,
roadblock, leakage and wastage across key areas
of flow within the supply chain - across both sides
of the 'buy and sell relationship'.

(c) Opportunity to maximise productivity / ROI.

(d) Opportunity to secure Long-term Aligned Business
Sustainability (ABS).

Supporting Dynamic Supply Chain Alignment
 


Purchasing & Procurement: Procurement represents a far more comprehensive and strategic process than purchasing, which is focused only on the tactical acquisition of goods and services. Although the terms are sometimes (incorrectly) used interchangeably, the evolution of procurement has been borne out of the volatile, globalised and highly competitive context in which businesses now operate. Unlike the purchasing department of old, procurement's role is more about helping the business to navigate complex supply chain risk which may come in the guise of fluctuating currency concerns, volatile commodity prices, economically unstable suppliers or greater reliance on third-party suppliers and contractors, often based in new geographic regions.
Procurement Professionals of today have more 'traditional' skills across mutiple direct and indirect categories. These include, technical category knowledge, contract management, cost analysis and negotiation. In addtion, HERM Logic procurement professionals bring strong commercial leadership skills, stakeholder engagement and change management experience to the task at hand.
Copywrite©: Group Aggregated Procurement, GAP - HERM Logic 2014 - all rights reserved

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