Name: 7 Ways to Identify Purchased Services Cost Saving Opportunities
Uploaded: 2021-07-09T14:38:09+00:00
Description: “How do I begin identifying purchased services cost savings?” Here are 7 strategies: 𝟏. 𝐄𝐱𝐩𝐢𝐫𝐚𝐭𝐢𝐨𝐧 𝐝𝐚𝐭𝐞: If your contract is expiring in 9-12 months, you must look …

“How do I begin identifying purchased services cost savings?”

Here are 7 strategies:

𝟏. 𝐄𝐱𝐩𝐢𝐫𝐚𝐭𝐢𝐨𝐧 𝐝𝐚𝐭𝐞:

If your contract is expiring in 9-12 months, you must look at it carefully.

You need to understand your needs, the marketplace, and the overall cost structure and prepare yourself accordingly.

𝟐. 𝐂𝐚𝐭𝐞𝐠𝐨𝐫𝐲 𝐠𝐫𝐨𝐮𝐩𝐢𝐧𝐠:

You can group your expenses (such as IT costs or outsourced laboratory services) to understand the entire categories.

𝟑. 𝐒𝐩𝐞𝐧𝐝 𝐯𝐨𝐥𝐮𝐦𝐞:

We all look to the high spend volumes as they reap the most significant savings.

But you can find a larger percentage of savings by analyzing the middle and even the lower portion of your spend because no one has looked at it at all.

𝟒. 𝐈𝐦𝐩𝐚𝐜𝐭 𝐨𝐟 𝐜𝐨𝐬𝐭 𝐬𝐚𝐯𝐢𝐧𝐠𝐬:

After doing some analysis, if you find that the identified cost savings have a bigger impact, that's a great place to begin your strategy.

𝟓. 𝐔𝐫𝐠𝐞𝐧𝐭 𝐢𝐬𝐬𝐮𝐞𝐬:

Not everything comes across as anticipated. You could come across growth issues, service issues, or a new strategic initiative.

That’s why considering urgent issues is important.

𝟔. 𝐍𝐞𝐭 𝐧𝐞𝐰:

You could have something brand new coming your way, such as a telemedicine offering.

So you’d need to analyze what's going on in your organization, the marketplace, and the benchmarking.

𝟕. 𝐈𝐧𝐜𝐫𝐞𝐚𝐬𝐞𝐝 𝐜𝐨𝐬𝐭𝐬:

You must pay attention to the year-over-year increases by your vendors.

If it's greater than 5%, you need to see if it’s for a good reason or some intervention is needed there.

If you’ve got an 8th, 9th, or 10th way to approach your purchase-services cost savings, I'd love to learn from you in the comments.