Procurement Fundamentals - CIPS 13th January 2025

 Well, I don't have any more open courses in 2024 (but am pretty full up with in-house courses) so here is some information about my first open skills course of 2025.

I shall be running Procurement Fundamentals online on 13th January 2025.  A one day course, giving you (guess what?) the fundamentals of procurement (for both public and private sectors, services and manufacturing).

Hope you will join us.

full details here.

Developing Commercial Skills for Buyers - BIP Solutions 7th March 2024

 As well as all the exciting stuff around the new Procurement Act 2023, we haven't forgotten the general skills required for Procurement.  

One of my mantras is that Procurement is just the other side of the table from Sales.  But somehow they are seen as commercial and we are just seen as clerical.  Not accurate!

(though my wife who works in sales thinks her company sometimes thinks they are just clerks too).

So we are running a range of courses for Buyers to help provide all the business and commercial skills that they need.

The first one is Developing Commercial Skills for Buyers online in 7th March 2024 - run by my colleague Gemma

Details are here.

Apologies for the change of date and presenter (no longer 27th February 2024).

I'm still writing it though.... which I guess may NOT be a selling point, but you are warned.

Bad Buying by Peter Smith

That's a book by Peter Smith, not examples of bad buying he has carried out!

 Not out till October, but it looks very interesting and I know I shall be first in line.  He promises it will cover Brandenburg airport in Berlin, which is one of my favourites (just because it is nice to have an example where we can compare with a British project that was mostly very successful - Heathrow Terminal 5).

In the meantime there is a website and Peter is promoting it on twitter at @gpetersmith.  

Peter is finding lots of things for the sequel in current government practices during the pandemic.

I only wish I had thought to write it first - but I am sure Peter will do a better job than I will.  

(I also expect lots of music tips)

Full disclosure - I've only ever met Peter once, when he asked me to write a brief article about tendering tips - which I never did! 

Introduction to Public Sector Procurement.

I am running the Introduction to Public Sector Procurement for CIPS in Manchester on 26th June 2018.  Full details are here.

Next one after that will be Edinburgh on 28th September (adapted to Scottish public procurement regulations, but also suitable for English, Welsh and Northern Irish delegates).  Then 20th November in London.

The last 2 courses will also have a second day going into more detail about some of the less common procurement routes such as Competitive Dialogue - Applying the Public Procurement Regulations.

The London event will also have the third part of the programme - the Future of Public Procurement.

Alternatively you could go for a 3 day course combining all 3 days, with a bit of extra stuff, in the Public Sector Skills Programme which we like to call the Summer school in public procurement - London 7/9 August, Manchester 21-23 August, and Edinburgh 4-6 September.

Hope to see you at some (but not all).

Bullying in the supply chain: Tesco

Following on from Sainsbury, the media is now focussing on Tesco and late payment.  The BBC had a very relevant interview with a small supplier from October 2014 to illustrate this week's story - Moo Chocolate.  Their point was that after contract Tesco decided to pay them late (or in their words to extend payment terms), and that the £6k involved was small change to Tesco but their monthly wage bill and late payment would have meant closure.

The interest on £6000 for an extra month is maybe £60 (based on 10%pa, which is probably too high as interest paid, and too low as interest charged).  I know that the cumulative sum of all these £60 is going to be a big number, but let's think about this in more detail. 

Firstly, if the buyer thought there was another £60 to be taken out of the price why didn't they go for it at the initial contract? If not, what do they think the consequences are going to be?

So, secondly, from working with ASDA Walmart years ago I believe that products are only going to be put on a supermarket shelf if they can make more money from the product than from whatever is on the shelf at the moment.  How much more?  Well I don't know.  But maybe 10% more is realistic.  Note that that is 10% more profit, not 10% more on the price.  In the case of small niche products like this chocolate bar the price is likely to be higher than Cadbury's anyway, but the profit margin will depend on a wide range of factors (raw materials, marketing, order costs, economies of scale in manufacturing, supplier power, contribution to supermarket promotions etc.).  So if the small supplier closes because of trying to get £60 extra out of the deal, you lose £60 in extra margin.  (yes, it will be replaced but if it could be replaced by something with a higher margin it already would have been).  That seems quite a risky way of doing things, unless you are absolutely certain that you can get the money out of the supplier - in which case see point 1.

And of course Tesco are now tarred with the same brush as Sainsbury, and in fact more publicly - which does not help their public relations and may have subtle longer term damage to the brand.

Was the £60 worth it?  Are the other £60s (from other suppliers) worth it?

I (oddly) hope that it is part of a considered strategy.  But I fear it was just opportunistic.

By the way, I was helping ASDA Walmart with bringing in these smaller suppliers.  The team there was well aware that small suppliers needed support before they were handed over to the "beasts" in category management who are as tough as they need to be.  And I don't underestimate how tough you need to be to do those jobs (I don't think I could) but you also have to be careful not to cross the line into being tough all the time when it is actually damaging to your long term interests