Animal Feed Market Procurement Intelligence Report

The market for Clinical and Medical Support Services and its sub-segments such as Animal Feed are at an interesting intersection. Rapid growth in the biosimilar and biologics market and global focus on gene therapy studies for rare diseases have resulted in an increased spend within the broader industry.

Despite increasing costs on almost all fronts, suppliers are resisting a drastic price increase due to intense competition where market players are willing to increase their market share at the cost of profitability. Therefore, buyers can expect pricing status quo in most cases, or only negligible to marginal price increases in some cases.

Many suppliers are expanding within the value chain to offer integrated solutions. With this new approach, suppliers can offer a wide portfolio of solutions and position themselves for large contracts that go beyond just Animal Feed. Buyers also find the benefits of volume buying, consolidation of supplier base, efficient co-ordination in case of an event and less spending on category management.

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

It has become imperative for category managers to remain as agile as possible in terms of their procurement practices. However, it is not always easy to quickly spot and implement alternative practices in a category like Animal Feed. To help quick decision making, this report advises on several procurement best practices that have worked well for category managers.

For example, Category buyers should invite bids from all potential service providers that have the ability to meet the overall requirements. Bids must be evaluated based on pre-defined parameters such as financial strength, reputation, offerings, geographical presence, and track record. Buyers can use standard scorecards to evaluate service providers and provide necessary feedback to rationalize the given scores. This helps in the effective documentation of decision-making processes.

Before engaging in a contractual agreement with suppliers, buyers should focus on identifying and understanding various critical parameters along with their impacts on different procurement models.

It is important for category managers to track and measure the performance of suppliers against a set of defined KPIs that are agreed upon during the contract negotiation phase. The performance of suppliers can also be linked to a portion of their fee that can be paid upon rendering of services in a satisfactory manner.

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