The Expense Category Manager Doesn’t Know The Cost Of Goods Of The Vendor Industry That Supports The Expense Category

Items four through nine on this list are closely interrelated. There is some overlap in their explanation, yet each has its own effect on your hidden profits.

As mentioned above, you can only tell that you’ve hit a target if you know where it is to start with. Without knowledge of the cost of goods, all you can do is select the best value from the options presented.

I’m not suggesting that a company should expect to receive bids that are equal to a vendor’s cost of goods. Obviously, that vendor either won’t be in business very long or will be unable to provide the support you’re been promised. Neither are good options for you.

The value of knowing the industry’s cost of goods is that it allows you to judge whether the bids you’ve received are competitive or if you need to reformat your bid request and/or ask additional questions of your vendors.

Next week…Reason # 6