Many buyers conduct the most basic of market analysis before they make procurement decisions. There is a tendency to go with who they ‘know’ without knowledge of the size, scale and structure of the market, the level of competition and the underlying conditions of the market.
Markets do not stand still. For example key commodity guides can be quite instable. The buyer may procure these commodities directly, or indirectly as an ingredient or component. Buyers may be unaware of market consolidation, the emergence of new players, technological development or new alternatives. All of these factors will, of course, impact on pricing. The implication is that the procurement strategy for this category will likely be fundamentally flawed or lacking in critical market insight.
Procure.ps’s Market Research Services
|Market Research||Profile the market structure including trends, forces and composition. Survey suppliers and conduct industry benchmarking. Analysis of competitive macro environment structure and then draw out key conclusions and findings to shape the category sourcing techniques and strategies.|
|Third Party Data||Scour data resources to build and maintain a profile of the industry, industry trends or dynamics, and key suppliers. This ensures that the category strategy is current and the buyer has visibility to the key suppliers in the market at all times.|
Approach and Experience
Our ultimate objective of market analysis is to assist the development of effective procurement plans and strategies. Procure.ps’s market analysis framework is used to determine market structure, as well as determine the relative power the buyer and suppliers have and the influence of change within the market such as new entrants, regulation, and substitute products.
It is critical that key outcomes for the development of effective procurement strategies be determined including supply-related risks, how favorable the supply market is to buyers versus suppliers, the probability of supply failure, and the identification of opportunities for improving value for money.
Market research is essential for buying organizations not only as a once-off task but more of a consistent approach to conditions both locally and globally.