Smart companies invest in procurement to boost thriving Saudi economy

16/08/2017 06:56 AST

The regional economic slowdown presents an opportunity for KSA companies to invest in strategic procurement solutions to bring down costs and drive growth. These strategic, long-term investments align to one of the Saudi Vision 2030’s key pillars in achieving its long-term goal of a thriving economy.

Dan Quinn, Senior Vice President at BravoSolution MENA, said: “In tough times, forward-thinking, smart organizations invest in procurement to reduce spend across all areas of their business without compromising on quality. Even a slight reduction in overall spend which can be achieved through procurement excellence can impact the bottom line for the better.”

He added: “The savings made can then be put back into smart investments that strengthen a business’ outlook during an economic downturn.”

“For a country whose Vision clearly outlines its goal of ranking as the 15th largest economy by 2030 – up from 19th position – the bottom line savings of private and government owned businesses made though even a slight spend reduction, has the collective power to positively impact the GDP of Saudi Arabia.”

According to strategic procurement tech company BravoSolution, the single biggest cost for most businesses comes from procurement. By bringing down these costs, businesses will be able to increase (or replace missing) profits.

“Research shows that on average 60% of an organizations profit and loss (P&L) is made up of third party spend, this is the materials, products and services that companies rely on to deliver their mission. It is the role of the procurement function to manage this spend effectively. Company executives know that reducing this spend has a disproportionate impact on their company’s economics as a dollar saved virtually drops straight to the bottom line and improves both cash flow and profitability. The trick is building the capability to systematically identify, unlock and critically retain these sources of economic value,” Quinn added.

Earlier this year, OECD said that despite modest pick-up in economic global growth, there are still risks and vulnerabilities that could derail market recovery.

It is here that procurement services can successfully be leveraged for strategic decision-making and management resulting in an increase in profits as well as more streamlined business operations in the Kingdom of Saudi Arabia, Quinn noted.

BravoSolution continues to support the region in meeting its diversification ambitions. It recently unveiled the latest version of its industry-leading, value-generating, strategic procurement platform, BravoAdvantageT17. The launch of BravoAdvantage 17 comes after Gartner, Inc. positioned BravoSolution as a leader in its 2017 Gartner Magic Quadrant for Strategic Sourcing Application Suites for the fourth year in a row.

Saudi Gazette