9 More Tips to Significantly Improve Your Purchasing Profitability

9 More Tips to Significantly Improve Your Purchasing Profitability

1. Ignore the term “discount”

This term should sound alarm bells when you hear it. Ask the right questions. What discounts are available? What prices are discounted compared to?

Prices that are discounted may not be available at all. They might be telling you about the price reduction they have for you by establishing the list price. What should you care about the price list? The list price should not be a concern. You should only care about the list price if it is the price you will never pay.

Do not assume that a discount will get you the lowest price or the highest value. Compare the price and other aspects of the sale to other sources. Don’t just deal with a supplier that offers discounts or claims to be a discount supplier.

It is important to compare prices. You should compare prices from different sources. What good is a 30% discount for a product they sell for $100, when you can get it at $50 from other sources? This “discounted product” is actually 40% more expensive than you paid. The price is $70 with a 30% discount of $100 This price is 40% more than the $50 it can be purchased elsewhere. This is quite a bargain, don’t you agree?

2. Do not tell the supplier who won the order what the lowest bid was compared to the other bids.

You can expect a higher price when you next have them bid. It is not a good idea to lose money. There is always some educated guessing involved in bidding. You can expect them to raise the price next time if they discover they were offered a lower bid than their competition.

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Why would they charge so much more than their competition when they are able to be as expensive?
They still have a chance of getting the job, even though they are so low last time. They should know
They underbid 15%. Next time, they might feel they can get up 10% but still be very under
Other suppliers

3. Never tell a loser how much they bid

They should always bring in the lowest price. They may lower their next bid if they discover that they were only slightly overbid. You may be able to save more if they feel they bid too high.

If I know that my bid was too high, I might bid 5% lower the next time I bid for this job. This will match the winning bid the last time, and will increase the chances of the winning bidder. If I feel my bid is too high, and decide to bid again, I might lower my bid by 10%, or even more. You could end up with a lower winning bid.

4. Never tell a supplier how much you are paying for an item.

Fair competition is important to you. You also want the best price. It is not fair to give one supplier an advantage over another supplier. You don’t want a supplier coming in below your current price when he hasn’t had a chance to compare your prices.

5. Recognize an employee who has done an outstanding job purchasing something at significant savings.

Let others know about the employee’s efforts. You want to recognize the employee’s efforts and encourage them to do so with all employees. This recognition should be visible and sincere. This is true for small and large purchases alike.

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6. Instead of purchasing new cartridges, use inkjet recharging dispensers

The refill kits can be purchased at most computer shops, office supply stores and direct mail offices. The cost per cartridge for inkjet printer cartridges is $30 or more. The cost of re-inking an existing cartridge will be about 1/10th that. This can save you hundreds, or even thousands of dollars each year depending on how many cartridges you use.

7. Recycled laser printer cartridges

These products are not only eco-friendly, but will also help you reduce costs by 25% to 50%. These savings can add up over the course of a year.

8. You want to save as much as 25% on your inkjet cartridges and laser cartridges?

If your printouts begin to fade or streak with inconsistent ink coverage, you can simply remove the cartridge from the printer and gently shake it a few times.

My laser printer cartridge could only print approximately 2,500 sheets of paper before I discovered this trick. It can now print high quality copies on more than 3,000 sheets of paper. The ink on the cartridge’s sides is never used because most of the paper you print has margins. You can move the ink from the sides of the cartridge to the middle by shaking it.

9. Do not buy a brand name unless it is necessary.

Generic supplies can save you up to half the price of buying brand-name supplies. Why would you spend twice as much on paper clips if you can get the same quality? Although I don’t know the exact number of boxes of brand-name paper clips that are sold every day, I do know that there are millions upon millions.

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You can save up to 50% on hundreds of products by choosing a generic or house-brand brand. There is no loss of quality or utility.

It is always a good idea to buy generic office supplies. Name brand office supplies will almost always cost more than generic brands, and this extra cost is almost never justified. How can you justify purchasing brand-name pens, pencils and paper, clippings, note pads, tape, forms and any other item that is for internal consumption?

You should at least be open to trying them. Compare the effectiveness and quality of the generic product with the brand-name equivalent. You can test a small number of generic products and still use the brand-name product. This will eliminate any risk in the unlikely event that the generic product is not acceptable.

Many times, the generic product is manufactured by the exact same company as the brand-name product. These products are just distributed and sold under a new label.

Be aware that generic names are not always cheaper than brand-name items. This will most likely be true in the majority of cases, however it is important to compare prices to confirm this. Sometimes, the brand name will actually be cheaper than the generic. This is especially true if a distributor or manufacturer is running specials or running sales. Don’t assume anything.

Derrick Welch, author of “In Pursuit Of Profits: How at Least Double Your Profits without Increasing Sales”, provided this edition of The Welch Report. This report includes 1,000 cost control, expense reduction, and income producing strategies you can start using today to dramatically increase your bottom line.