Spend Analytics and Indirect Procurement: The Key to Unlocking Savings and Improving Procurement Performance
In today’s fast-paced business world, companies are constantly looking for ways to cut costs and improve their bottom line. One area that often gets overlooked is indirect procurement, which includes all the non-production related goods and services that are necessary for a company to operate effectively. This can include everything from office supplies and IT services to marketing materials and travel expenses.
While indirect procurement may seem small in comparison to direct procurement (the purchase of raw materials and other goods directly related to production), it can actually account for a significant portion of a company’s overall spending. In fact, studies have shown that indirect procurement can make up as much as 40-60% of a company’s total procurement spend.
Given the importance of indirect procurement, companies need to be proactive in managing and analyzing their spending in this area. This is where spend analytics comes in. Spend analytics is the process of collecting, cleaning, categorizing, and analyzing spend data to identify patterns, trends, and opportunities for savings. By leveraging spend analytics, companies can gain a better understanding of their indirect procurement spend, including where the money is going, who is spending it, and how it is being spent.
However, manually analyzing spend data can be a time-consuming and error-prone process. This is where Mithra-Ai’s Cognitive Spend Intelligence platform comes in. The platform uses advanced artificial intelligence and machine learning algorithms to automate the spend analysis process, making it faster, more accurate, and more effective.
With Mithra-Ai’s Cognitive Spend Intelligence platform, companies can:
- Improve visibility into indirect procurement spend: The platform provides a single view of all indirect procurement spend data, giving companies a clear picture of where their money is going and where they can make improvements.
- Automate spend classification: The platform uses machine learning algorithms to automatically classify spend data into categories, reducing the time and effort required to manually categorize spend data.
- Identify areas for savings: The platform helps companies identify opportunities for savings by analyzing spend patterns and trends. This can include finding opportunities for negotiated discounts, identifying areas where suppliers can be consolidated, and identifying spend that is outside of company policies.
- Improve supplier management: The platform helps companies better manage their supplier relationships by providing a clear view of spend data and supplier performance. This can lead to more informed decision-making, better negotiation strategies, and improved supplier relationships.
In conclusion, spend analytics and indirect procurement are critical components of any company’s procurement strategy. By leveraging Mithra-Ai’s Cognitive Spend Intelligence platform, companies can improve their visibility into indirect procurement spend, automate spend classification, identify areas for savings, and improve supplier management. These improvements can lead to significant cost savings, improved procurement performance, and a stronger bottom line.
About Mithra-Ai Solutions
Mithra-Ai develops a best-of-breed Cognitive Spend Intelligence SaaS platform for strategic procurement. The mission is to help procurement teams to shine by taking over tedious and time-consuming (low value, high volume) activities and letting them focus on high-impact decision-making and value realization for their organization. Mithra-Ai is built by and for procurement professionals to make data-driven decisions by providing them ‘continuous’ visibility and insights into their spend data. Companies need to source and procure more responsible, and this is where Mithra-Ai makes a positive impact. You cannot be responsible if you don’t have continuous full transparency and insight into your direct & indirect spend.