Category Archives: B2B 3.0

The Sourcing Innovation Source-to-Pay+ Mega Map!

Now slightly less useless than every other logo map that clogs your feeds!

1. Every vendor verified to still be operating as of 4 days ago!
Compare that to the maps that often have vendors / solutions that haven’t been in business / operating as a standalone entity in months on the day of release! (Or “best-of” lists that sometimes have vendors that haven’t existed in 4 years! the doctor has seen both — this year!)

2. Every vendor logo is clickable!
the doctor doesn’t know about you, but he finds it incredibly useless when all you get is a strange symbol with no explanation or a font so small that you would need an electron microscope to read it. So, to fix that, every logo is clickable so you can go to the site and at least figure out who the vendor is.

3. Every vendor is mapped to the closest standard category/categories!
Furthermore, every category has the standard definitions used by Sourcing Innovation and Spend Matters!
the doctor can’t make sense of random categories like “specialists” or “collaborative” or “innovative“, despises when maps follow this new age analyst/consultancy award trend and give you labels you just can’t use, and gets red in the face when two very distinct categories (like e-Sourcing and Marketplaces or Expenses and AP are merged into one). Now, the doctor will also readily admit that this means that not all vendors in a category are necessarily comparable on an apples-to-apples basis, but that was never the case anyway as most solutions in a category break down into subcategories and, for example, in Supplier Management (SXM) alone, you have a CORNED QUIP mash of solutions that could be focused on just a small subset of the (at least) ten different (primary) capabilities. (See the link on the sidebar that takes you to a post that indexes 90+ Supplier Management vendors across 10 key capabilities.)

Secure Download the PDF!  (or, use HTTP) [HTML]
(5.3M; Note that the Free Adobe Reader might choke on it; Preview on Mac or a Pro PDF application on Windows will work just fine)

SaaS Procurement for S2P+ Goes Beyond Basic Buying Etiquette for IT Procurement

Medium recently posted an article from ArmourZero, a cyber-security platform provider*, on IT Procurement Etiquette for User and Vendor, which I guess goes to show the lack of knowledge on how to buy among some organizations. It doesn’t go nearly far enough on what S2P buyers need to know, but it does provide basics we can build on.

The advice it provides for a user are:

  1. Do Your Homework (Create a Proper SoW): take the time to provide a proper Scope of Work (and don’t just take a vendor’s sample SoW, edit it slightly, and send it out, especially to the vendor you took it from)
  2. Professional: be neutral and don’t favour any specific vendor
  3. Transparent: be clear about the process, and if all bids exceed the budget and a reduced bid is required, be clear about the reason for going back and any modifications to the SoW to allow vendors to be within a budget range
  4. Fair: stick to the rules; not even incumbents get to submit late; if you have a minimum number of bids in by the deadline, you work with those; you weight on the same scales; etc.
  5. No Personal Interest: don’t accept gifts; don’t vote on the bid where you have a relationship; etc.

However, in our space, you have to start with:

  • Do Your Tech Market Research: make sure you understand the different types of solutions in the market, what the baselines are, and what the standard terminology is (sourcing != procurement)
  • Do Your Deep Dive Tech Market Research: once you figure out the major area, figure out the right sub area — a Strategic Sourcing Solution is not a Strategic Sourcing Solution is not a Strategic Sourcing Solution; a CLM (Contract Lifecycle Management) is not a CLM is not a CLM; and an SXM is definitely not an SXM which is definitely not an SXM; in the case of Strategic Sourcing, do you mean RFX? e-Auction? or optimization-backed sourcing? in the case of CLM, do you mean Negotiation, Analysis, or Governance? in the third case, which element(s) of the CORNED QUIP mash are you looking for: compliance? orchestration? relationship? network? enablement? discovery? quality? uncertainty? information? performance? No vendor does more than half of these, and those vendors will only do a couple of areas really deep and more-or-less fake the rest!
  • Write a Process and Results Oriented RFP (& SoW): it’s not features or functions (beyond the foundational functions all applications in the class need to support) it’s the processes you need to support, the systems you need to integrate with, and the results you need to get — let the vendors describe how they will solve them, not just check meaningless yes/no boxes … they might have a more efficient way to support your process, a faster way to get results, etc.; the same goes for any implementations, integrations, services, etc. — make sure it focusses on what you need to accomplish, not meaningless check-the-box exercises
  • Do Your Due Diligence Vendor Research: once you have figured out the solutions you need and the primary capabilities you are looking for, make sure the vendors you invite not only offer the type of solution, but have (most of) the foundations of the capabilities you are looking for; use analyst firms, maps, tech matches, and expert analyst consultants to build your short-list of mandarin to tangerine to orange vendors vs random google searches that, if you are lucky, will give you apples to oranges, and if you are not, will give you rutabagas to oranges to tofu vendor matches

Then apply the rest of the advice in the linked article by ArmourZero.

You’ll have better success in your RFP, negotiations, and your implementation if you do all of your homework first, even though it is a lot more extensive than you want it to be. (But remember, there are expert analyst consultants who can help you. No one says you can’t hire an expert tutor! And the reality is that you should spend five figures before making a six to seven figure investment (as there will be implementation, integration, and support costs on top of that six-plus license fee), and maybe even do a six-figure deep dive process and technical maturity assessment, market scan, and custom RFP/SoW generation project with an expert analyst consultant before signing a recurring [high] seven figure suite deal.

* A CyberSecurity firm is the last vendor you’d expect to be authoring such a post (given the massive increase in CyberAttacks since 2019), but I guess it shows just how bad buying can be if they felt the need to write on this vs. a SaaS Management Vendor

The B2B Software Marketplaces Will Rise. Then the Hammer will Fall!

Thanks to Apple, every consumer thinks there’s an app for that. And for most consumer desires, there probably is. Especially since Apple’s App Commerce climbed to 1.1 Trillion in 2022. Yes, that’s 1,100,000,000,000 US Dollars! That’s a lot of money, especially when most apps are being sold for a few bucks.

When you consider:

  • consumer app marketplaces are now a Trillion dollar business
  • enterprises are buying more SaaS than ever, as every employee in every department wants an app(lication) to support every task they do
  • enterprises pay 10X to 100X what individuals pay per user license, and, thus, the opportunity of enterprise app marketplaces is in the tens (to hundreds) of Trillions
  • enterprises want easy, centralized, acquisition to limit the number of vendors they need to deal with / handle subscription invoices from

It’s easy to see why all the big software / cloud vendors are opening their own app marketplaces. A recent article on IOT Analytics shouted the rise of the B2B software marketplaces while quoting their B2B Technology Marketplaces Market Report (2024-2030) that noted that:

  • they are the fastest growing procurement channel (for software)
  • dedicated platform providers are seeing success
  • some sellers make Billions

And they will continue to grow for a few years. But then, the hammer will fall.

What one has to remember is the following:

  • many of these marketplaces are taking a big cut, like 30% or more, which is what a sales partner would have taken to compensate its employee(s) that actively sold the product, but they are doing NOTHING but creating a listing, making it searchable, taking an order, collecting a payment, and providing a license key … even when you consider cloud fees, payment processor fees, platform maintenance fees, they could be very profitable at 13% (remember that recent article on how roughly half a trillion dollars will be wasted on SaaS spend this year … well, this is only going to increase that as you’re paying almost 20% more than you need to for the licenses you do need and use)
  • apps, licenses, and overspend is going to proliferate rapidly as “approved” app stores make it easy for every employee with a p-card to buy what they want, when they want
  • those SaaS audits and rationalizations that identify 33%+ overspend are only going to reclaim at most 20% of that, if you’re lucky, because, even if the software developer is willing to refund unused licenses, they’re not going to refund that 30%+ they already paid the marketplace … and that’s if they’ll even talk to you because you acquired the license through a third party
  • there’s no real negotiation opportunity when you buy from a marketplace

So as businesses race to digitization, they will embrace the marketplace as it will help them get part of the way there very quickly, but then when they realize just how much they are spending on app(lication)s, and turn Procurement on strategic procurement of SaaS, the first thing to go will be the app marketplace purchases … and then … it will be time for the hammer to fall.

Keep Your Procurement On PACA with FSMA with Procurant!

We don’t cover specialist Procurement providers much here on SI because many don’t have much in the way of domain specific product functionality (and differ primarily on domain knowledge, terminology customization, and service offerings), but some, like Procurant, go beyond the basics and offer domain specific functionality of relevance that the market needs to take note of. Especially when such functionality can help an organization be compliant with current and, most importantly, incoming regulations they are not ready for.

Procurant, marketing itself as a strategic platform for perishables that does Procurement AND Food Safety, offers the following core functionality:

  • P2P (Procure to Pay) for Perishables
  • Inspections (recording and auditing)
  • Traceabillity that is mobile-enabled and FSMA 204 compliant
  • Market Intelligence
  • Food Safety (workflow and remote sensor integration) (not covered in this article)

It’s the one-stop solution for retail grocers, especially those with US operations, that need to manage their perishable supply chain in a manner that is both PACA and FSMA compliant. (And if you’re a grocery retailer that does NOT know what those acronyms stand for … Uh-Oh! Better find out and give Procurant a call ASAP — because failure to comply can not only result in fines but [supply chain] shutdowns.)

Procurement/Procure-to-Pay wise there isn’t much that’s unique in core functionality (as the uniqueness is with the integrated support for the perishable space), but it’s all there, and we’ll start with the core so you can be confident the core is on par with other best-of-breed Procurement solutions.

With respect to quote management, the platform contains integrated RFQ / price request that makes it really easy to not only request (updated) quotes from suppliers, but get a commitment on that price (for a certain time or volume; i.e. one week or 100 pallets). When you get a commitment, the system tracks orders against that commitment, and then lets you know when the quote has expired because the commitment has been used up (and if you still need more product, you need a new quote with a new commitment).

With respect to order management, the solution makes it easy to select products for orders from the built-in catalog, from order templates (guides), or from demand forecasts (which can pulled in from the forecasting/demand management system OR created natively in Procurant using weighted average outbound for the last 12 weeks, with more forecasting algorithms coming in a future release). The platform even supports the definition of automatic (replenishment) orders, should the organization choose that functionality. Once the order is assembled, it’s very easy to send it to the supplier for fulfillment.

Moreover, as Procurant ‘s P2P also contains integrated support for carriers and logistics (due to the need to monitor the entire produce supply chain and ensure food safety every step of the way), in Procurant, you can also assemble orders by truckload, as you don’t want to be under-shipping if not absolutely necessary (as it takes the same amount of energy to maintain the temperature when refrigeration is necessary whether the truck is almost full or almost empty) and it’s easier to trace when you decide who is shipping what, when, and on which truck. One great feature of the platform is that it’s super easy to assemble an order for a carrier. It’s just a matter of dragging and dropping order line items until the platform notifies you that the last line won’t fit in the truck (as you can encode a max # pallets, weight, and volume by truck and as soon as one limit is reached, the platform lets you know). No complex training on a sophisticated TMS required.

As a result of this deep support for logistics and carriers, purchase orders can be incredibly detailed and include shipping dates, carrier, load reference number(s), and even cross docks.

Also, order management is multi-state and the system will track and notify if there is an:

  • order modification by the buyer
  • order modification by the supplier
  • order cancellation by the supplier
  • order reconciliation by the supplier (on being notified the goods received didn’t match the PO)

and all changes by any party are maintained in a secure, unalterable, audit log.

With regards to order management, the buyers can choose whether or not the supplier can split orders, remove items, or add substitute orders. Whether or not they can change prices (or just quantities to match availability), and even when modifications will be accepted. Similarly, the administrator can determine the order creation capability the buyers have access to … whether or not they have (to use) guides, whether they can create cross-dock orders, etc.

With respect to invoice management, it’s super easy for a supplier to flip a PO to an invoice. All they have to do is enter the actual quantity shipped by line item and submit. The invoice then goes into a wait state until a receipt is entered, at which point if there is a discrepancy, the invoice is sent back to the supplier for correction before it goes into the normal processing queue, where it would be held up until the discrepancy was resolved, which could delay payment considerably if the organization has long approval chains for corrections and exception processing.

The platform also tracks supplier fill rates, so you can quickly see which suppliers are fulfilling the POs they accept and living up to your expectations and which suppliers are not. It also has price watch capability, and can alert you whenever PO or quote prices exceed current (or historical) prices by a certain percentage.

And, of course, there’s a dashboard which summarizes current tasks and open orders and great search and filter functionality to find just the orders, invoices, or quotes you are looking for.

The platform also integrates the inspection reports from their inspection app and, for any fulfilled order, you can quickly bring up the full report that summarizes the inspection (packaging, appearance, condition, flavor, and quality) on each item delivered as well as the number of items rejected. Also integrated with the Procurement platform is the Inspection Module that contains the overall inspection summary dashboard, dill downs by supplier, scorecards by supplier, and other key reports and data points on inspections. The inspect application is a mobile app that workers can use at the warehouse on or the dock to inspect the quality of goods as they come in and, if necessary, reject them on the spot.

What’s really cool is the Track and Trace capability where, for any item, you can see the entire journey from the source lot to the warehouse or the store shelf, as appropriate. You just need a GTIN, lot number, order number, SKU, or product description and, optionally, a date range and you see the store shipments, receivings at your warehouses, vendor shipments, and base lots. And you can click into each store shipment, receiving, vendor shipment, or lot and see complete details (such as the ship to, date, and receiver for a store shipment; order #, sales order, Lot, shipper, shipment date, and cases for a vendor shipment; etc.). And with their next release, the (default) output report formats will be usable for FSMA compliance. (Again, if you do grocery retail and you don’t know why this is critical, you better find out soon!)

Finally, their Market Intelligence Capability in Procurant Connect provides Commodity Pricing, Weather, and Transportation analytics and tracking. The commodity pricing tracks price movements across all commodities by region; the weather pane integrates forecasts down to the county level; and the transportation analytics tracks average load fees by lane (defined by city pairings), as well as price changes and shipper / transportation availability (surplus, slight surplus, adequate, slight shortage, or shortage).

Procurant can integrate with your ERP and AP (payment) system, your TMS (or onboard carriers natively, which is something not many P2P systems can do as carrier management is critical in perishable supply chain management), and your supplier master (for supplier onboarding) if it’s not your ERP.

All-in all, Procurant is a fantastic solution for the perishable supply chain procurement and one that absolutely has to be on the short list of any grocery retailer that needs to get a handle on their perishable supply chain in a manner that will allow them to be fully PACA and FSMA compliant.

B2B Marketplaces Have Their Place But …

… don’t look to them as a foundation for supplier collaboration! While it’s nice to see Procurement platforms and technologies getting noticed in Financial publications, the juxtapostion of the headline and subheading on this recent Financial Express article made us go “OI! YOY! YOI!”.

The headline was great:
Integration of B2B marketplaces into supply chain networks for increased efficiency

… it’s exactly what Finance needs to hear as B2B Marketplaces are a great solution for commodities or products typically bought spot-buy on the open market, and much more efficient than sending out an RFP for something you can find and buy quicker, easier, and cheaper online, and definitely better than searching half a dozen supplier sites to find the right product at the right price.

And the subheading started off great:
A notable opportunity for enhancing Supply Chain Management (SCM), as rated by 53% of businesses, lies in collaborative efforts with suppliers.

… because collaborative efforts are not only a great way to increase efficiency, but also increase value by lowering cost, increasing quality, adding capability, etc.

But the way the sub-header ended was head-scratching to say the least:
… The answer lies in utilizing user-friendly and efficient B2B marketplaces.

NO! No, No, No, NO! If you want to collaborate with suppliers, you need a modern Supplier Management solution that focuses on supplier development, innovation, and collaboration.

B2B Marketplaces were created to help buyers find (new) suppliers to buy from and to help suppliers widen their potential customer base when buyers find their products in a search and check them out. They were not setup for collaboration and the extent of “collaboration” on the majority of these platforms is asynchronous messaging. That’s not collaboration! Not even close.

In comparison, a Supplier Management platform with

  • Relationship Management will not only support asynchronous messaging, it will also support collaborative project/product plans and a best practice/knowledge base for both parties
  • True Network Management and not just an integrated online marketplace will also support a true bi-directional graph, bi-directional search, classification, and anonymous (peer)
    reviews
  • Proper Discovery will not only support simple searches, but deep location, product, capability, and multi-factor searches; proactive web-search and web-site monitoring; anonymized ratings and reviews; and deep product sheets and history management
  • Orchestration Management will support multi-tier linkages, cascading onboarding, and multi-tier supplier support so that you can quickly and easily onboard the supplier onto your own personal Supplier Management instance that you can customize to your liking
  • Enablement Management will add an integrated supply-centric portal, sustainability guidance, and true supplier-led innovation support

In other words, this article, which could have focussed on the core value of B2B Marketplaces and introduced them as a first step into the Procurement world, with an entire suite of valuable tools to help an organization, missed the mark.

For more information on what a proper Supplier Management platform should do, as well as a list of vendors who offer these platforms, see parts 15 to 20 of our The 39 Steps … err … The 39 Clues … err … The 39 Part Series to Help You Figure Out Where to Start with Source-to-Pay.

Supplier Management

Part 15: Supplier Management is a CORNED QUIP Mash

Part 16: Supplier Management A-Side

Part 17: Supplier Management B-Side

Part 18: Supplier Management C-Side

Part 19: Supplier Management D-Side

Part 20: Over 90 Supplier Management Companies to Check Out