The death of non-core pricing

Controlling costs and tightening up spend are two of the ‘go to’ measures a business can implement to help them weather any storm. So, when the potential impact of COVID-19 began to really hit home, OfficeTeam went back to the drawing board to further improve how we support our customers. And the result? We decided to make the bold move to put a stop to RRP and non-core pricing models.

We explore the rationale for this industry-first decision, before considering what a newfound degree of transparency could mean for the procurement landscape…

RRP and non-core pricing models have been a tradition in the business supplies market since the ‘get go’. However, times change, and in truth, a shake-up was needed long before the onset of COVID-19.

There’s a reason the biggest online retailer continues to grow irrespective of the temperature of the economic climate. Cost visibility coupled with convenience makes purchasing quick and easy, on the face of it.

But as a recent OfficeTeam blog highlighted when considering purchases in the business environment, defaulting to online retailers can soon lead to rogue spending, lack of quality control, multiple invoices, escalating procurement costs, and often a questionable carbon impact – to name just a few risks.

This doesn’t mean, however, that the need for greater price transparency can continue to be overlooked. We know procurement teams need it – pandemic or no pandemic – so we’ve become the first in the industry to make the bold move away from RRPs for all non-core products.

How will this change the way we work? 

This never-before-seen level of pricing clarity is going to be a game charger in the business supplies industry.

Until now, customers could have spent hours on tender process due diligence – reviewing and comparing the pricing of core products – only to be stung later down the line with massaged pricing on non-core items. This doesn’t just hinder the ability to control budgets – it also risks dampening the customer-supplier relationship at a time when collaboration and cooperation matters more than ever.

However, with clear price transparency on all non-core items from the start, the partnership kicks off on a far stronger footing. And, with OfficeTeam pledging to check the market regularly – with the aim of always pricing within 10% of the leading online retailer – your procurement teams have complete peace of mind that they can focus on their day jobs, without fear of spend spiralling.

Why is now the best time to embrace market prices?   

As the working environment continues to evolve, so too does procurement.

The much-debated ‘new normal’ means employers have had to dismiss many business traditions, in favour of supporting remote colleagues now working in multiple locations. And the demand for a wider range of products – across a number of different areas associated with work, play and productivity – has rocketed as a result. 

In fact, the spectrum of non-core items your teams will need in the short term is only likely to increase and evolve. With clear price transparency on these products, we can help you to maintain control of your non-core spend during this ever-changing transitional period and prevent rogue procurement which all so often means costs spiral.  

Is price the only factor?

Price is always going to be an important factor when screening suppliers – hence our new 10% promise.

However, price should never be considered in isolation. In fact, a new Gartner publication suggests that short-term and unsustainable cost cutting measures mean companies’ long-term opportunities to reshape their competitive standing, risk being overlooked.

When choosing a preferred supplier, we therefore advise that you also review their key differentiators and the value they can bring to your business. The ‘whole-life’ benefits of an ongoing partnership – whether relating to service levels, delivery or expertise – often have a far greater impact on long-term cost savings and process efficiencies, way into the future. 

Recent Econsultancy research has found that 55% of British consumers think brands are taking advantage of the pandemic, for example. We’re here – on the other hand – to help customers build a supply chain process fit for the future. We’re looking far beyond price reductions alone, to ensure you establish a ‘new normal’ with even more efficient procurement processes, savvier reporting, and team flexibility reflective of the modern business environment.

Introducing our wrap-around services:

Our new-look suite of wrap-around services – designed to help customers do business smarter, for the long haul – therefore include:

•   A dedicated account manager, on-hand to provide industry expertise and guidance across a range of business products and services. We will find the exact solutions to your queries, whilst proactively guiding you on how to adapt to the ongoing changes presented by the working environment.    

•   Proactive review of your expenditure. Taking it further than just product pricing, we will regularly look at your expenditure as a whole with a ‘birds eye view’, highlighting areas where further cost savings and process efficiencies can be made.   

•   Business intelligence. Next-generation reporting within SmartPad allows you to create customisable at-a-glance or deep dive reports in only a few clicks, and make informed, data-driven procurement decisions that have a true bottom-line impact.

•   True consolidation. Offering the industry’s widest choice of products and services from a single supplier, we give your teams access to everything they need from one trusted partner, for a tailored solution which helps you combat unpredictable pricing and fragmented spend.

•   Product innovation. As the business environment continues to adapt following the COVID-19 lockdown, we will provide you with the products your organisation needs to keep working effectively, wherever colleagues are working and however the uncertain landscape unfolds.

•   A flexible, adaptable delivery service. From deliveries to your colleagues’ homes, to guest checkout and desktop deliveries straight to your office – all from a safe distance – we’ve adapted to meet your needs now and into the future.

If you want to know more, and you’re interested in the impact that our market pricing could have on your bottom line, please contact us.

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