Lac Market Procurement Intelligence Report

The market for Environmental Goods and its sub-segments such as Lac are at an interesting intersection. Several structural changes including M&As and vertical integration efforts of suppliers are characterizing the broader market. Such strategic developments can erode the strength of previously established supplier relationships due to changed realities in the supplier's ecosystem. At the same time, buyers may also find opportunities to onboard new suppliers with a wider range of offerings or better contract terms for .

Several factors in the value chain of Lac, such as labor cost, logistics, and energy costs are driving up the procurement costs. Additionally, engagement of suppliers who are still operating with outdated assets, technologies and processes is also increasing the cost for buyers.

Buyers are moving towards longer contract durations with suppliers of Lac to benefit from value-based discounts, integrated products and services, lower renewal cost and lesser expenses on contracting activities.

Trends like these and many others discussed in this report are necessitating a relook at the way Lac 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 Lac procurement insights and hand picks best practices that can work for category managers delving in this market.

For example, Investing in benchmarking studies helps category managers in enhancing their knowledge on market pricing of products and costing of maintenance and support services). This arms them with better ammunitions for negotiation.

Buyers need to evaluate the in-depth expertise of suppliers in the Lac industry. This can be assessed by considering factors such as the years of experience, number of resources that have multi-year experience of working in the same industry and at least 3 to 5 credentials for the supplier.

Strong R&D focus is the sign of a supplier committed to enhancing the quality and cost proposition of its solutions. Buyers should collaborate with such suppliers for development of low-cost but highly efficiency products that can bring their OPEX down.

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