Tail Spend Management
What is Tail Spend?
Management of your lower value purchases which could have a significant volume of your total number of purchases..
- Classic 80:20 rule: where 80% of what the procurement team works on is just about to manage 20% of the purchases in terms of spend.
- Small value items in various diverse categories.
- Items where the dollar value is not very high, but which take as much time and effort to manage as strategic high-value purchases.
Benefits:
- Your procurement team is freed up to do what it does best- manage strategic sales,
- Consolidation and reduction of number of supplier,
- Lower supplier management cost,
- Get advantage of Tier 1 diversity spend for all the purchases in the tail despite the original supplier not being a diverse supplier,
- Consolidation of payment dates and terms possible,
- Get Benefit of volume discounts which we get as a result of bulk purchasing and being strategic partners with many OEMs and software companies,
- Timely processing of POs,
- Cash or Service Rebates,
- Since we have not only expertise in software reselling, but also software implementation, LSI could be a one-stop solution for purchase and installation/ integration of software you purchase through us,
- Consolidation of licenses purchased at different locations/ departments/ Business Units,
- Co-terming of licenses which expire on different dates,
- Detailed reporting monthly, quarterly, annual basis,
- Possibility of extending your payment terms from a 30-day or a 60-day term to a 90-day term,
- Timely alerts and management of renewals.
Tail Spend Management Services:
- Management of lower value items in various categories which typically form 80% of total purchases.
- Consolidation of suppliers.
- Advantage of diversity spend even if vendor is not a diverse supplier.
- Benefit of bulk discounts since we buy in large quantities.
- Timely POs, detailed monthly, quarterly, annual reports.
- Consolidation and co-terming of licenses.
- Possibility of increasing payment terms from 30 to 90 days.