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Cost Management

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Good times or lean, let’s stick together …

GM Procure was created out of a need for fairer, more predictable pricing for both landlords and their supply chains. We have been fortunate to have had many buoyant years during which we have all benefited. Our job creation schemes and community enterprises have been successful and we have met many of the objectives we set out to achieve. But the economy has taken a big hit recently prompting us to re-assess our strategic approach to costs.

The key thing to say is that GM Procure’s approach to procurement and best practice in the current downturn is not significantly different from that at any time since our inception.

Strategic approach and collaboration
A strategic approach to supply chain management is defined by its long term pricing, relationships and procurement policy. So the fact that the industry is presently struggling should not mean that we need abandon our principles of long-term partnership.
Remember, the GM Procure set-up funding was dependant on the Egan principles of collaboration and partnering to deliver efficiencies and innovative procurement. We were fortunate that the period of very low increases in our pricing - 0.5% on average - was set against a backdrop of sustained growth in the industry: members and clients benefitted from our framework and GM Procure grew. It is worth noting here that when the framework was formed we benchmarked savings of around 30% on existing member procurement activity.

Our strategic approach to cost management aims to smooth out the tender price highs and lows over a sustained period for predictable pricing rather than the short-termism of ‘spot buying’...

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