Daily Archives: July 7, 2009

Your Cash Costs You More Than You Think

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While a recent article from Stores on the true cost of cash didn’t actually tell you how much your cash costed you as a merchant relative to debit, credit, and other payment solutions, it did provide some good ideas on how to decrease the cost of handling, and securing, that cash.

Counting cash is costly. It takes time. It can be miscounted. Some of it can disappear in the counting process. However, automation technology in the form of “smart safes” can reduce this cost considerably.

Taking cash to the bank yourself is costly. It takes time, increases the risk of theft, and delays the credit to your account until it is received AND processed by the bank. However, cash logistics services such as armored transportation, deposit solutions, and cash processing can reduce those costs and get you your credits faster. For example, store receipts can be transmitted electronically.

It was a decent article, and if you handle a lot of cash as part of your business, you should consider checking it out.

Some Negotiation Best Practices from the IACCM

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An article from a recent edition of IACCM’s Contracting Excellence on applying negotiation best practices and advances in personal productivity technology offered some suggestions for negotiation practitioners and supply management leaders that are worth a refresh.

Noting that the changing scope of business and technological advances dictates a need for new, or at least updated, negotiation skills and that every negotiator needs to

  • know her objectives,
  • know her organization’s requirements,
  • know her, and her organization’s, competencies
  • know the resources she has available, and
  • know the targets she has to meet

the document outlines some best practices that will help her maximize the resources and competencies available to meet performance targets and negotiation objectives.

  • Establish a Replicable Process
    Repeatable processes save time and get better results.
  • Use Collaborative Tools
    These days, supply management professionals need to lead cross-functional teams to insure they will get the best deal for everyone. Collaborative tools will help them work with individuals across the organization who are located in different geographies.
  • Increase Skills and Capabilities
    Giving everyone basic training can significantly increase the benefits realized by the supply management organization. Certifying a department will go even further.
  • Mentor
    Have your “A” Team mentor your “B” team, and keep your “A” team on the leading edge by sending them to seminars with negotiation leaders at least once a year.
  • Rehearse Negotiations
    Get someone from sales with experience in the category you’re sourcing to play the role of vendor. Ask them to give you a rough time. This will not only help you understand how sales people think, and minimize the chance of being surprised in the face-to-face negotiations, but it will help you earn the respect of the sales department who might not value your contribution to the bottom line, which is five to twenty times more powerful than theirs.
  • Use supporting technology
    e-RFX can greatly simplify the initial data collection. Data analysis software can help you analyze market indices and should cost modeling software can use this data to help you understand how much a product or service actually costs. There’s no weapon more powerful than knowing a supplier’s margin before going into a negotiation.