| Purpose and (strategic) orientation |
| Process name | Demand bundling (product catalogue) |
| Objectives | The objective of this process is to place an order through the means of demand bundling using a specialized intermediary. |
| Description of basic activities | The process comprises searching for an intermediary, negotiation on terms and conditions and - afer notificiation - the order placement performed by the intermediator. |
| Strategy related key words | |
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| Business management issues |
| Implementation costs | A prerequisite for bundling your company's demand is select-ing an appropriate intermediary and - if necessary - adapting the procurement data formats accordingly. In order to fully take advantage of the benefits the internal procurement proc-esses should also be adapted; in particular for indirect goods (MRO) it might be necessary to centralise current processes. |
| Differentiation opportunities | There are no additional differentiation opportunities through demand bundling in procurement. |
| Benefits | The fundamental benefit of demand bundling is the opportunity to reduce wholesale prices, which is due to in-creased bargaining power and higher volume discounts, which could not be realized by each individual company itself. |
| Critical success factors | Bundling demand usually requires long-term planning. It is therefore fundamental to be able to plan demand for the required period. Open standards should be used for the exchange of business documents in order to minimize investments specific for single intermediators. |
| Efficiency criteria | The usage of non-proprietary standards for exchanging business documents allows a closer integration of the relevant systems and in this way supports better process efficiency. |
| Risks | There is the risk of loosing differentiation opportunity due to procuring the same goods as other competitors. |
| Associated processes |
| Higher level process | |
| | | Modeler | Carola Lange | | Creation date | 11/03/2004 12:19 | | Last update | 31/03/2004 14:00 |
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