You saw a situation where spend analytics could be used over and above the standard analysis of the transactions https://faoblog.com/processes-ap-spend-analytics-contd/
Spend analytics has a lot of application.
On the purchase side, some areas where it can help are:
- Purchase logistics and execution
- Vendor Credit Analysis
- Contracts/Deals Management
- Order Consolidation
- Cost of purchases optimization
- Freight Planning/Scheduling
- Replenishment Optimization
- Repacking & Shipping
- Trailer/Yard Management
- Physical Inventory Check
- Reverse Logistics
Spend analysis helps with how optimize procurement costs across geographies and also helps assess strengths and opportunities for handling spikes and troughs in a planned manner.
Analysis Leads to Understanding
How healthy is the procurement channel and the dedication of employees for optimizing costs incurred by them? It help in:
- Know your supplier’s potential.
- Learn which products are good and reliable.
- Find out which businesses are becoming prohibitive, adding extra cost to your end product.
- Understand your requirement trends and the cost of urgency.
Analysis Leads to Cost Savings Opportunity
Businesses can use Spend Analysis to:
- Reduce cost.
- Plan your purchases based on your sales demand.
- Help local businesses.
- Attract new vendors.
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