Malt Extracts Market Procurement Intelligence Report

A changing ecosystem within the Food and Beverages market also affects the procurement process, cost dynamics and supplier attractiveness for the buyers of Malt Extracts. Suppliers have historically gained handsome margin-on-margin by sub-contracting a part of their work to another contractor. However, Buyers are now delving deep into the business models of suppliers and negotiating hard to avoid further sub-contracting. In cases where it is imperative to sub-contract, category managers are employing should-cost models to keep supplier margins on sub-contracting to the minimal.

As market presence of companies become global, there is a growing preference towards service providers who can provide services seamlessly across the globe and have excellent understanding of local regulations and culture.

A balanced approach to procurement of Malt Extracts has emerged, where buyers with multiple locations first outsource at individual locations and gradually move to standardize and consolidate the services across facilities.

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 Malt Extracts procurement insights and hand picks best practices that can work for category managers delving in this market.

For example, Category managers must explore opportunities to integrate planning and management activities of categories using analytics, to gain better control over category spend. This will also allow them to consolidate their supply base easily, as well as to segment suppliers based on requirements and spend on each supplier.

Benefits of an integrated program are more apparent over a period of 5-7 years, and the goal in such relationships is to achieve cost savings and improve performance in the long run. Buyers should opt for suppliers that have a track record of long-term engagements as this will increase the probability of these suppliers sustaining in a mutually beneficial relationship for a longer duration.

Investing in benchmarking studies that help category managers enhance their knowledge on pricing or billing rates of suppliers allows them to not only save costs, but also negotiate better with suppliers. For example, while negotiating for bundled services, they can save significantly on a single service by cross-verifying rates quoted by suppliers against industry benchmarks.

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