Strategic sourcing is a multifaceted process that sourcing managers follow to pick the best supplier for a project. The process involves careful planning and cost-effectiveness to attain the desired results. To make sure all the essential steps are not missed, sourcing managers should follow a checklist with following steps for smoother Request for Proposal (RFP) process:
Established the requirements
Before crafting the RFP, sourcing managers should first determine if the product or service they want to procure is vital to their business. Is it necessary for business operations? Will it improve business performance? They should also make sure the product or service is not already available in their company to avoid unnecessary expenses.
Obtain funding approval
Sourcing managers should seek funding approval before sending out the RFP to avoid damaging supplier relationships. So before starting the vendor sourcing process you need to have a defined budget in place that can be quoted to the suppliers.
Estimate the cost of procurement
Cost reduction is a top priority for most Chief Procurement Officers (CPOs). It is, therefore, important to conduct due diligence by researching the market prices of services and products. An estimate will provide a clear overview of whether the procurement costs meet or exceed the allotted budget.
Determine the best procurement strategy
Developing a strong procurement strategy is the most cost-effective and efficient way to create value for a business. A good strategy ensures a positive working environment, transparency in business processes, and longevity of supplier relationships. Automating the process through an RFP management software is often the best way to go since it simplifies the process and allows sourcing managers to monitor and track with analytics.
Evaluate suppliers and award projects
Sourcing managers should create clear supplier evaluation criteria. The RFP questionnaire should be allotted weightage/ score for easier evaluation. It helps them identify key areas of the project that require greater emphasis. Pre-defined templates or questionnaire in RFX management solution, such as Aavenir RFPflow offers you to set weightage against each question and auto-evaluate the responses to select the best vendor.
Strategic sourcing is a complicated process that requires careful consideration of all the necessary steps to make informed decisions about suppliers. By following the above steps, sourcing managers can streamline the procurement process and save money. Aavenir RFPflow simplifies the process even further, and sourcing managers can take advantage of it to get the most value for their business. BOOK A DEMO
