Monday, 27 July 2015

Does Cost Plus Encourage Lazy Procurement?

Cost plus:
(definition, adjective)
relating to or denoting a method of pricing a service or product in which a fixed profit factor is added to the costs.”

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You could argue that every item or service sold is cost plus.  In other words you need to make a profit to stay in business so everything purchased has to have a margin added so the final sale will be more than the sum of their parts.

The area of cost plus that I would address is where the client has agreed to buys products or services from a supplier and the final price for those bought off the contact is not known.  This unknown value will be created from a cost plus relationship to ensure a profit is maintained.

However, if the client continues to pay, where is the incentive for the seller to ensure they are procuring the goods or services at the market price. Surely the client should be ‘on the ball’ and focus on year on year cost reductions although many times complex and varied builds on a contract prevent this.  ‘Should cost’ exercises would be a useful tool in a perfect world if we all had the time but isn't that why you are together with a trusted supplier?  Surely the supplier would focus on procurement costs so their sales exercises would be more competitive? You would think so, but what if the market is not so competitive.  

In fact, does the cost plus model mainly arise in non-competitive markets dominated by larger players? If this is the case you could draw the conclusion that procurement is not being driven in the right direction due to a number of unbalanced forces (cost plus, lack of competition, lack of customer focus). This bad practice could easily spiral downwards. Will increased globalism be enough to shake up these suppliers or will the customers drive better value? Either way it often seems that procurement in these type of industries can be an afterthought that is of little importance. Viva la procurement revolution.



About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Wednesday, 15 July 2015

Dear UK, Please leave. From France.

This article was a challenge to write and should be viewed with good humour and in a amicable fashion. As a good French and European citizen, I am obliged to defend our interests and evaluate yours. For all our sakes you must stay in the European Union.

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The UK Government is planning a referendum to decide whether the UK should remain a member of the EU.  French media rarely broadcast information about this referendum at the moment, which is maybe the reason why French people don’t seem really concerned. I asked my friends and family in France if they thought Britain should remain in the EU. Many responded with disinterest, stating they did not care either way.

While doing research on the web in a BVA survey (French society of opinion polls) I discovered that 52% of French people are in favour of the the UK leaving  the E.U with 73% falling in  the 18 to 24 years old category,however I think that it would be a huge mistake for the UK and France.

Mainland Europe is still the UK’s main partner with more than 50% of your international trade. This includes Germany with their reliable cars and us (France) with our excellent wines. Although both may be exorbitantly priced, can you imagine living without them? In France, we use an expression that would perfectly describe  this situation “se tirer une balle dans le pied”, which can be translated as “shooting oneself in the foot” {I believe you have the same expression }

Let’s be more serious. According to a research project carried out by the London School of Economics, if the UK were to exit from the EU, your GDP could decrease from anywhere between 1.1% to 3.1% (which equates to roughly £50 billion). The idea of leaving the EU immediately appears more far-fetched…
And if prices do not increase, perhaps its  because you copy this powerful nation once known as the “Kingdom of Norway” by spending billions to buy your participation ticket to the free exchange within the European Union.  Of course this position would allow you to remain in  contact with E.U members, who are by far your biggest clients and suppliers. However you will be subject to E.U rules and no one will take your opinion into account. Was it not one of the reasons which push you to leave?

E.U isn’t a “jail”, it’s your ally. Getting together and applying common rules makes the EU the leading world power allowing us to negotiate widely favourable agreements.
A prime example being The Transatlantic Trade and Investment Partnership, a potential new agreement allowing free exchange between the EU and US. Should the UK disassociate itself from the EU, where does that then leave it? Would they still get to reap the benefits of this unique partnership opportunity between the United States and the European Union?
Hopefully we won’t see another situation arise similar to the ‘Banana Wars’ of 1997.
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If  unfortunately I am wrong and leaving the EU is beneficial, who will help Francois Hollande and Angela Merkel to pay for all those countries whose economies are in worse shape than ours?We would have to find more than £6 billion to offset your departure. Then, what would we do if all immigrants stayed blocked on our coasts? In reality, we need you in the EU, our unemployment rate is already nearly 5 points higher than yours (…although apparently this makes our productivity higher due to the higher wages and the need to be competitive on a global basis.)

I therefore appeal to the sharing and mutual aid between United Kingdom and the E.U.
Nick Drewe, co-founder of Market Dojo, comments that this break-up will have little impact on Market Dojo’s software as it is designed to not depend on particular legislation, which is a considerable advantage. Indeed, some competitors would need to change some parts of their applications in order for them to adapt to the new UK market and so could actually help us. However, the impact on sales is unknown.

This situation may even have some advantages for Market Dojo. Indeed you British buyers could be subjected to particularly difficult negotiations due to an increase of Incoterms. Looking for solutions to reduce these additional costs would be a priority and I know where you can find some great software to help you negotiate...
However more serious constraints also appear with regards to French internships. As Alun Rafique, co-founder of Market  Dojo mentions, French interns may encounter more difficulties to work on British soil. In addition to all the good work the interns produce, we would be left without anyone to make such excellent tea, and who would ensure the office was maintained to such a high standard?
Nick and Alun recently visited France with great ease, but in the future, should Britain depart from the EU, booking flights may not be as simple as it once was and lengthy Visa applications could unfold. This would make the current ease and simplicity of popping to France a thing of the past. Lets hope not!
By Alex Mahe.

About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Monday, 13 July 2015

Market Dojo listed as a Supply Chain Brain "2015 Great Supply Chain Partner"

As the most comprehensive supply chain management resource, we feel incredibly privileged to have made the cut for Supply Chain Brain’s honourable list.

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Supply Chain Brain seeks out emerging trends, technologies and best practices, forward-thinking ideas and cutting-edge solutions. The go-to place for senior-level supply chain executives, they collate this knowledge across a range of platforms to provide an informative resource for true professionals.


With last year’s vendors being selected for excelling in Reliability, Expertise and Global Reach, it is exciting to be chosen as a provider that addresses these issues accordingly.


Brad Berger, Supply Chain Brain’s publisher, stated:

"Each year, our list of 100 Great Supply Chain Partners features a select group of companies whose customers are recognizing them for providing outstanding solutions and services.  

This year we received nominations for literally hundreds of solutions providers in every aspect of supply chain management, as a result of our six-month on-line poll: in which supply chain professionals were asked to nominate vendors and service providers whose solutions have made a significant impact on their company’s efficiency, customer service and overall supply chain performance.  

Market Dojo Ltd. will appear in the 2015 July/August issue of SupplyChainBrain magazine as a celebrated member of this year’s 100 Great.”

A huge thanks to Supply Chain Brain and to all who voted for Market Dojo.


About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Monday, 6 July 2015

Release of Multi-Evaluator scoring

We are delighted to announce another new feature to our tool for multi-evaluator scoring of proposals, available today.

The development was another successful collaboration with a client of ours who generously contributed to one-third of development costs to help us allocate a development team without delay, in return for extended licencing terms.



The enhancement allows you to invite multiple stakeholders, or even groups of stakeholders, to score participant responses.  You can invite the stakeholders to score specific sections or the entire questionnaire.  The tool will automatically send the scorers their invitation to the event as well as notifications when new responses are available for them to score.

The owner of the event can clearly see which scorers have not fulfilled their duty so they can chase up the task.

Should more than one stakeholder score a particular section or questionnaire, the tool will automatically average the scores to carry forward into your weighted tender or overall evaluation.



Stakeholders will only be able to view the questionnaire or section that they have been invited to score, thereby keeping their process very simple.  Of course if you'd like them to view more of the tender, you can do so using our User Hierarchy.

Lastly we have a neat 'Comments' button so scorers can share their feedback on any particular question for the event owner to take into account.

There is a slight surcharge of 10% on top of your existing licence fees to enable this feature but in return you can have unlimited scorers assisting you with your evaluations, all supported to the highest level by the Market Dojo team.

We hope you enjoy!

About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Friday, 3 July 2015

2015 West of England Business of the Year Awards


A massive thanks to PWC and the invitation to the annual awards.  A very well run black tie event in the  Passenger Shed next to Temple Meads station with guest presenter Ian Axton of ITV West.

There was a great intro by the Wallace & Gromit's Children's Charity which is a national charity raising funds to improve the lives of sick children in hospitals and hospices throughout the UK .  Collections we made during then event with the promise to embarrass some PWC folk by getting them dressed up as sheep for the end of the night. It was the precursor to more than a few Shauns ready to appear in the city.  [Please give generously]

There were also some deserving finalists and in the two categories the final winners were the Devon Air Ambulance Trust and also Botts Limited.  The event was accompanied by some videos of each of the finalists that we'll have to admit were very professionally constructed and the event was also to be broadcast on ITV West  [I am sure we will be household names very soon!].  

Unfortunately this was not the year of the Dojo but we have high hopes for the next.




About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Wednesday, 17 June 2015

The cross functional nature of marketing


A traditional view on marketing was to simply split it by indirect and direct marketing.  Indirect is where you are not going direct to a client and direct is where you are. Both are there to create leads. Sales would be the conversion of those leads to opportunities and hopefully sales.


However, increasingly we will see terms out there such as inbound marketing and search engine optimization.



Are these terms just re-badging of the traditional all encompassing models for specific areas.  For example, Inbound marketing is a mixture of picking off parts of indirect marketing (i.e. landing pages) and direct marketing (i.e. email automation). SEO is simply about improving your organic search.  


So it might be useful to put together an all encompassing, collectively exhaustive table. It is also helpful to cross reference how the various techniques can help with your strategy.


Indirect marketing tactics can help with your overall game plan in one of four ways.  Three of these are related to how people find you: through paid ads, referrals or backlinks, organic search. The fourth one refers to how prospects interact with your website.


Each of the various Indirect tactics can affect your different strategic imperatives.  To give you some examples:


Social media and video can obviously help with your referrals from youtube. They can be used embedded in the paid ads or on your website.  Also as google analyses their website traffic, this will ultimately help with organic search.


Landing pages are great for specific adverts but can also help with specific content on your website and as above ultimately help with organic search.


Keyword density is really focused on assisting with organic search improvements and again with website conversion through appropriate content.


All in all it takes a hand in each of these tactics to improve your marketing strategies.  There is no magic bullet (unless you hit that viral masterpiece - good luck!)


We live in times where search engines are looking for good content that attracts and engages visitors, and keeps them on your site.  The strategies you focus on and the tactics you use need to be examined with constant care where quality is more important than quantity.








About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com

Friday, 5 June 2015

HomeServe Identify Savings Opportunities of £1.9 Million following the Implementation of Market Dojo’s eAuction Platform.

Market Dojo strive to make procurement professionals’ lives easier by providing innovative cloud-based eSourcing tools. Founded in 2010 by procurement professionals, and having received three grants for innovation, Market Dojo’s main focus is enabling better adoption for both the buyer and the suppliers. 

Jadon Silva, Director of UK Procurement, spearheaded the implementation of this software at HomeServe with the first auction taking place in April 2015.  Following HomeServe’s first three auctions, savings of £1.9 million have been identified.

HomeServe was formed in 1993.  Its mission is to be the UK’s leading home assistance company. The scope of services they provide ranges from plumbing and drainage emergencies, locksmith services and gas boiler repair.
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With a growing network of experienced engineers, HomeServe provide a reliable service across the globe, with operations in the UK, US, France, Italy, Spain and further afield. 

Jadon Silva and the team at HomeServe have identified a number of reverse auction opportunities by using Market Dojo. Through these, the home assistance experts plan to generate even greater savings, which will hopefully carve the path for a fully adopted eSourcing approach. 

Two separate categories have so far been auctioned. The first was for the supply of envelopes which took place in a single day and comprised of three ranked auctions to supply the UK, France and Spain. Ranked auctions allow participants to see their position in the auction, relative to other participants. They really encourage competition amongst suppliers and are the most commonly known and widely used e-auctions that take place. 

Market Dojo attended  HomeServe’s head office in Walsall for the first auctions where a phenomenal value of £500k was saved, working out at 30% of what the company were previously paying. 

The second category was for the supply of various subcontracted services, which encompassed four auctions across 20 different regions of the UK. The slightly more aggressive Japanese auction style was used and over 140 suppliers were invited to take part in each auction. Each of the suppliers were able to bid on any of the regions, which were created as separate Lots. Japanese auctions involve the buyer setting various bid levels for each lot, which the suppliers then have to accept within a certain time period. Once this time period passes, a lower price level is designated. This process repeats until the last participant declines a bid level or the time runs out. 

Through Jadon’s resilience to push the Japanese e-auction agenda, HomeServe saved a staggering £1.4m.  Additionally, negotiation processes which may have taken weeks or months, were completed in a matter of hours.
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With success resonating across HomeServe, Market Dojo looks forward to continuing to build a long-standing relationship with the home assistance provider. 

Commenting on the savings achieved, Jadon says; “It is great that we can extract this value from smarter procurement initiatives.  The subcontractor network may have fallen into the complex category, which often doesn't favour e-auctions.  However, with the correct communication, due diligence and controls, we have proved that the e-auction methodology can still be a success.”

Alun Rafique, co-founder of Market Dojo mentions ”We are delighted to see another company bring eSourcing in-house with such ease and uncover large savings.  Jadon has shown how eSourcing can be successfully adopted by his team of buyers and their diverse range of suppliers.”

When asked what HomeServe would do with the savings, Jadon replied; “The savings we make allow HomeServe to invest in what is really important to us as a business.  Customer experience is at the heart of what we do. We aim to be at the forefront of new technology, which aligns with providing our customers effortless service.”

About: Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com