Milk | Intelligence Report | Procurement.Spendedge

Strategic Sourcing Guide to Milk Procurement

Overview

Several macro changes in the dynamics of overall Food and Beverages as well as Milk procurement trends are poised to change the business practices and procurement thumb rules. Outsourcing of Milk now represents a significant part of the global spend on this category, driven by value derived and a growing number of vendors who keep innovating with new services and value propositions.

Suppliers are shedding the category expert tag and moving up the value chain to offer an integrated approach to their services. With this new approach, suppliers can offer a wide portfolio of services and position themselves for large contracts that go beyond just Milk.

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.

Category managers need to take note of the potential of these developments and reassess the changes required in their procurement practices.

Milk Procurement Best Practices

As market conditions become more dynamic and procurement practices get more sophisticated, category managers need to be cognizant of the best practices that work for their Milk category procurement. The report offers a succinct analysis of Milk procurement best practices.

For example, 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.

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.

Buyers should set a baseline against which the performance of suppliers can be benchmarked along with setting measurable/quantifiable KPIs. Defined KPIs provides suppliers with clarity on the scope. Besides setting standards for operations, pricing, and performance, KPIs must provide tangible goals in terms of the quality of solutions.

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Risks in Milk procurement

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

Workers may have to handle hazardous substances/materials. Non-compliance to the safety standards and working without using the personal protective equipment can result in accidents and affect operations. Workers are also required to work at heights while carrying out cleaning activities. Non-adoption of precautionary measures by workers can lead to fatalities or severe injuries, thus negatively impacting the reputation of buyers
When requirements of the buyers are not absolutely clear or usage patterns are not stable or predictable, suppliers often build in \"cost buffers\" for unforeseen risks due to a lack of complete understanding on buyer's requirements. This increases the risk of overspending on Milk
Suppliers regularly outsource services such as housekeeping and food services to the third-party vendors. However, when third- party vendors fail to offer service due to technical or operational constraints, this results in significant losses to the buyers

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Who should read this report

The report is intended to serve as a one-stop reference guide for Milk procurement strategy and offers a perfect blend of category basics with deep-dive category data and insights. Therefore, it is ideal for category beginners looking for “Milk: Procurement Report 101” as well as for category experts actively tracking the global Milk procurement market.

You may have just initiated your research to design a winning Milk procurement strategy, or you may be a category expert looking for strategic insights and updated data.Either ways, the report has your requirements covered.

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Key questions on Milk procurement answered by this report

Procurement decisions can prove to be costly in the absence of careful deliberation and evaluation of every available option. In fact, more than 90% of the decision makers we work with acknowledge that timely availability of up-to-date category intelligence can help them make better purchasing decisions. More than 80% of them believe that in-house category intelligence needs to be updated periodically to achieve full benefits. If you have read so far, we are quite sure you agree!!

The Milk procurement report helps take more informed decisions by placing all the critical information and advice at the fingertips of a decision maker. It also specifically answers some of the key questions that we have been routinely asked during our industry outreach initiatives:

What is the spend potential in the Milk market?
What is the correct price to pay for Milk? What are the key trends and factors that influence current and future pricing?
Which selection criteria are the most important for Milk Suppliers Market?
Who are the top Milk suppliers? What are their cost structures?
Which negotiation levers can reduce Milk procurement cost ?
What are supplier margins in Milk market?
What are the best practices for Milk procurement and what are the potential risks?

SpendEdge Insights has helped procurement professionals and sourcing teams manage multiple spend areas and achieve more than $2 billion in savings. Activate your free account today!

Milk Category Insights: What is inside

The Milk market report offers a complete picture of the supply market and analyzes the category from the perspective of both buyers and suppliers. Analysis of the category trends, procurement best practices, negotiation levers and overall category management strategy advisory are interspersed with in-depth data and commentary on spend outlook, pricing ecosystem and supplier landscape drilled down to a region-level coverage.

Data

A key highlight of this report is the in-depth outlook created on Milk procurement spend and pricing trends. The report further delves deep into the aspects of cost structure, total cost of ownership and supplier margins for Milk. A dedicated section to supplier profiles and evaluation helps decision makers cast a wider procurement net and identify gaps in existing relationships.

Insights

Along with specific category and supplier intelligence, the publication also includes curated insights on Milk market trends, price influencers and inherent risks. These insights help the decision makers prepare for market shaping trends in advance and create alternative strategies for changes in the market conditions.

Advisory

Additionally, the report also advises on the best practices and strategies to manage the Milk category efficiently. Negotiation levers and opportunities are explained in detail along with quantification of their potential. Benchmark KPIs for supplier and buyer performance management are also aggregated to better organize the category objectives. Other themes of advisory include ideal procurement organization structure, enablers to achieve KPIs or category objectives and ideal SLAs to have with suppliers.

Category Ecosystem

Buyer and supplier ecosystem
Competitiveness index
Buyer and supplier power
Threat of new entrants and substitutes

Global and Regional Sourcing Insights

Category spend
Spend growth
Dynamics
Opportunities

Pricing and Cost Analysis

Pricing outlook and data
Drivers of pricing
Cost structure and inputs cost
Total cost of ownership
Pricing models and margins

Cost Saving Opportunities & Negotiation Strategies

Buyer and supplier side levers
Quantified cost saving opportunities
Negotiation strategies and quantified outcome

Procurement Best Practices, Strategy and Enablers

Procurement excellence
Sustainability and innovation
KPIs and category enablers
Risk management and outsourcing

Vendor Analysis

RFx essentials and selection criteria
SLAs
Supplier evaluation metrics
Detailed supplier profiles

Our research is complex, but our reports are easy to digest. Quantitative analysis and exhaustive commentary is placed in an easy to read format that gives you an in-depth knowledge on the category without spending hours to figure out “what does it mean for my company?”

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Category Research Framework

SpendEdge presents a detailed picture of Milk procurement solutions by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key category influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.