Over the past decade, technology has irrevocably changed how we conduct business. But one thing that hasn’t changed is the physical objects that every business needs to operate. Equipment, janitorial supplies, maintenance and repair items, office supplies, and even kitchen snacks are still vital to running a modern office. These not only are a significant cost center but also require constant maintenance and management. Recently, however, new tools have made it possible for businesses, schools, and government organizations to streamline their procurement operations, saving time, money—and even local economies.
As one of the world’s largest companies, ExxonMobil has a massive procurement footprint that includes thousands of people across six continents who collectively spend more than $40 billion per year with thousands of suppliers. Therefore, any improvement in price or efficiency in a company of this size has massive downstream effects. “At our scale, every percentage point counts,” says Nassim Kefy, procurement manager at ExxonMobil. “When you save thousands of dollars on each transaction, it adds up fast.”
“Amazon Business is an integral piece of our digital transformation.”
— Nassim Kefy, Procurement Manager at ExxonMobil
ExxonMobil found that Amazon Business provided one of the most effective ways to realize such efficiencies. Amazon Business allows companies to get instant snapshots of what is going on with their procurement, whether they need visibility into what employees are buying or want instant analytics on overall spending trends within the organization. “For large companies, one of the biggest advantages is being able to look end-to-end across the entire procurement process,” says Aster Angagaw, vice president, head of commercial, public, and strategic sectors for Amazon Business. “Selection, price, and convenience are nice, but visibility, analytics, and control are next-level tools for improving large businesses.”
Amazon Business also simplifies digital transition by integrating directly into many e-procurement systems, another technique ExxonMobil is using. “If your organization is serious about delivering superior value to customers, you have to be ahead of the curve,” Kefy says. “Amazon Business is an integral piece of our digital transformation.”
Large businesses are not the only ones that can benefit from enhanced digital procurement tools and features. Typically, big companies have entire departments dedicated to procurement. In small businesses, however, the procurement manager likely plays an important role—and often it is the owner themselves.
Red River Brewing Company is a restaurant and brewery operating out of Red River, New Mexico, run by Michael and Sharon Calhoun, along with their son Chris, who is their head brewer. Although their procurement needs are extensive, as a small business focused on their day-to-day operations, they want to accomplish this with as much efficiency and as little drama as possible. “What we like most about Amazon Business is the ability to find almost everything we need to run this company in one place,” Michael says. “It means I don’t have to spend hours leafing through catalogs or driving long distances.”
“One thing small businesses love is the ability to pay by invoice,” Angagaw says. “When you are organizing your procurement and reconciling your books, it’s always better to have everything on detailed invoices.”
Red River uses Amazon Business to source everything from office supplies and IT equipment, to point-of-sale systems, shelf-stable goods, and brewing systems supplies. They also take advantage of mobile ordering, which allows them to place real-time orders from the floor of the restaurant. “I keep lists of my commonly purchased items, and with the push of a button I’m restocked in two days,” Michael says.
“Selection, price, and convenience are nice, but visibility, analytics, and control are next-level tools for improving large businesses.”
— Aster Angagaw, Vice President, Head of Commercial, Public, and Strategic Sectors at Amazon Business
Finally, Amazon Business makes it possible for organizations to leverage their purchasing power to do good for their community. New features allow users to index products based on whether they are local businesses, whether they are minority owned, or whether products have any sustainability certifications. The city of Baltimore has been using Amazon Business to turn its purchasing across 50 different departments, offices, and commissions into a tool for stimulating business for local companies.
“It is very important that city agencies have the ability to buy directly from our local suppliers,” says Erin Sher Smyth, the city’s former chief procurement officer. “Amazon Business allows agencies to search for products from diverse groups of vendors including veteran-owned businesses, LGBT-owned businesses, as well as women- and minority-owned businesses.”
Amazon Business’s Guided Buying feature, available with Business Prime plans, also provides easy-to-use tools for administrators to set guidelines for what products employees can purchase, setting preferences for anything from price to sustainability or locally sourced products. The popularity of these new tools is its own best endorsement. “Companies are increasingly choosing to allocate more of their spend to suppliers who support their mission,” Angagaw says. “In the past two years we’ve seen a tenfold increase in customers using Guided Buying to set preferences for small, diverse local suppliers or for more sustainable products.
Originally published on Fast Company, click here to view.
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