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Online Negotiations Can Reduce Procurement Cost

Mr. Gaurav Singhal from Sapeap states that negotiating procurement prices online can reduce the cost and that too with less effort specifically under severe financial stress due to the COVID-19 pandemic.

May 26, 2020

sapeap
Web portal www.sapeap.in

At the time when paper industry is under severe financial stress due to the COVID-19 pandemic, negotiating procurement prices online can reduce the cost and that too with less effort, according to Gaurav Singhal who owns a web portal “sapeap.in” which helps companies increase their efficiency of procurement. For the purpose, companies should increase competition among their suppliers.

Warren Buffett, one of the most successful investors in the world, once said: “Industries run on marketing but survive on procurement.”

According to Mr. Singhal, it is possible to increase profit by 50 percent by 3 ways—by saving 10 percent in procurement, by increasing sales by 50 percent, or by increasing sale price by 5 percent.

“All of us are well aware that in the competitive market it is a very tough task to increase sale price or sales by 50 percent, but reduction in procurement is not so tough.”

“We have to increase competition among our suppliers, and we have to just change the way of our negotiations from offline to online—the concept adopted by all major paper industries like Tamil Nadu Newsprint, Khanna Paper Mill etc. Online negotiations of price can definitely reduce the procurement cost in less efforts,” the statement added.

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