Ironmongery Market Procurement Intelligence Report

The market for Engineering Products and Equipment and its sub-segments such as Ironmongery are at an interesting intersection. Procurement costs for Ironmongery are highly impacted by an increase in the costs associated with the value chain of Ironmongery, such as logistics, labor cost and energy. Additionally, outdated assets are also increasing the cost for suppliers.

Volatility in the prices of key inputs is creating multiple issues that impact procurement within Ironmongery category such as benchmarking and budgeting of the procurement costs.

Suppliers are under an enhanced pressure to offer greater quality, options that suit unique requirements and overall experience of the customer stakeholders involved.

Trends like these and many others discussed in this report are necessitating a relook at the way Ironmongery is procured and the procurement cost saving opportunities that exist.

Sometimes, procurement functions are unable to timely alter their practices while responding to market conditions. Industry experts acknowledge that periodically reviewing procurement best practices and adopting learnings from across procurement categories can help procurement teams respond to market needs in a more agile way. This report combines our experience of other categories with Ironmongery procurement insights and hand picks best practices that can work for category managers delving in this market.

For example, Buyers must have a clear understanding of the subcontracting policies, if any, of Ironmongery suppliers. Factors such as cost incurred, service quality, adherence to timelines, and regulatory compliance of subcontractors employed by suppliers should be carefully assessed prior to engagement.

Buyers should engage with suppliers that repurchase used products at fair market value. This assists buyers to dispose of used products in a convenient manner. Also, during such repurchases, suppliers provide credits to buyers for future purchases. This reduces overall procurement costs for buyers.

Buyers should assess the level of adoption of the latest technologies by suppliers to assess cost-saving opportunities and quality that can be provided by the latter. For instance, the adoption of technologies such as cloud computing will enable suppliers to reduce their internal computing hardware requirements for operations such as CAD and CAM. This can, in turn, enable them to reduce their operating costs, thereby suppliers can offer products at lower rates to buyers.

Ironmongery procurement managers also need to proactively identify and mitigate potential risks that can arise in the supply chain or contracts for Ironmongery procurement. Some examples include: