Top Five Categories to Source Now – European Market

Q&A Session

July 15, 2010

 

At last week’s webinar, Ariba’s European category management team discusses critical market information and spotlights the indirect categories that you should be sourcing today for maximum impact. Be sure to watch the replay!

 

The following questions were answered during and after the live event. For additional questions, please contact Haiying Xie at hxie@ariba.com.

 

 

 

Print Management and Translation Services

Answered by Jean-Pierre Lauer, Sr. Manager, Indirect / Services

 

Q: Can you auction Translation Services and Travel Agency?  If so how do you recommend we structure the auction?

A:  Auctions for translation services can be conducted however they are not the preferred way of negotiation.

 

The quality of translation remains very much driven by the quality of the translator, hence buyers must make sure that translators are paid the market price.

 

When conducting auctions, a lotting by specialty (e.g. marketing or technical) or language can be envisaged.

 

Suppliers would then bid on the extended value for the service (i.e. including all cost elements: translation, project management, DTP).

 

Q: Please elaborate on sustainability with regards to the printing industry

A:  More and more organizations require their print suppliers to have PEFC or FSC certifications as this aligns with their own Corporate Social Responsibility. There are other aspects regarding sustainability that Buyers can consider when selecting print supplier, for example waste produced by the supplier or efficiency of the transport methods used.

 

Q: How do print management companies select their subcontractors?

A:  Print Management companies use a wide range of criteria when selecting their suppliers (overall output capacity, accreditations, quality....) and conduct regular audits. They use a mix of small and large suppliers which guarantees in principle competitiveness whatever the size of the job. Proximity to the final customer is also important as it allows to reduce transport costs.

 

Q: How can print management companies ensure consistency in quality?

A:  There is no guarantee for clients that the print management company will systematically use the same suppliers. However the selected printers must have the right equipment that guarantees regularity in quality (e.g. in color schemes).

 

Q: You talked about giving suppliers of translation services a sample. Is it not an easy exercise for them?

A:  It is actually a challenging exercise as tested suppliers do not own the client translation memory or the glossary. Ariba has seen many suppliers paying low attention to the quality of samples provided. The exercise can also reveal what control the supplier has on the overall chain of operation. It is an exercise worth conducting!

 

 

 

 

Mobile Telephony

Answered by Louise Hartle, Category Manager, Indirect / Services


Q: Is it possible you would brief on Temp Labour. Is there any possibility for multi country consolidation, if yes, what to look at? 

A:  There is possibility for multi country consolidation and major suppliers do have the capability to respond to multi country bids. Often there is little pricing impact, however benefits come from supplier management efficiencies in dealing with fewer suppliers via a preferred supplier list or  a vendor operating with a sole supplier status. 


Q:  When will suppliers be ready for data pool options - similar to what we see with voice pooling options?

A:  Currently suppliers are able to work with pooled voice options and these work well for organisations whose profile fits with this type of usage. It would be surprising if data pooled options did not appear in the near future as an available option given the increases we are seeing in data usage.

 

 

Q: If I am working with flat rates, what is the best way approach to obtain bundled prices?

A:  The best way to approach bundled prices is to ask suppliers to quote on both flat rates and bundled prices. Flat rates being your main apples to apples comparison and then asking suppliers to provide options for bundles based on the usage profile provided in the RFP. Suppliers need to demonstrate how you they would optimising pricing with their various bundles, pools and options.

 

Q: My organisation currently buys country by country. Is a European bid possible? How does the European market structure look?

A:  It is possible to have a European bid. Suppliers do have the capability to reply with one contact to a European bid and are organising themselves internally to be flexible to such requests. The market structure is as follows 1) The Freemove alliance which is composed of Orange, Telecom Italia, T-Mobile and TeliaSonara. Freemove can cover 26 countries with more than 260 million customers worldwide. 2 ) Telefonica which owns 19 networks across Europe and South America. It includes 02 and Movistar.  Telefonica will partner on a case by case basis out of its own networks if needed, for example with Bouygues Telecom in France. The Telefonica Group has 207 million customers worldwide. 3) Vodafone is the third main player with 200 million customers located in 27 countries. The alliance includes three types of operators: the Vodafone operating companies (e.g.: Vodafone Germany), Partner Markets (e.g.: Swisscom) and affiliate networks (e.g.: SFR in France).

 

 

 

Travel

Answered by Mike Darlow, Category Manager, Travel / Transportation


Q: Can you auction Translation Services and Travel Agency?  If so how do you recommend we structure the auction?

A:  It is possible to auction travel agency if it is on one or two countries and limited to offline agency pricing.  If the sourcing is for multiple countries, Europe or Global then there are too many parameters to conduct and online auction and best practice would be to source, review and ask for rebids on countries that exceed the current incumbent.  Pricing for a comprehensive bid could possibly have the following: offline/online pricing, bundled/unbundled fees, menu priced extras such as Account Management, MI data, 24 hours etc.

 

Q:  You have indicated consolidating to one travel agency, can any one agency achieve this globally?

A:  Yes, currently there are 6 agencies with a global capability and other can be reviewed at a regional level.  Best practice would be to map out countries needed for a consolidated agency and ensure that the agency has  fully owned office locations for the brand and not franchises which may not have the same service level agreements.

 

Q:  How can I collate accurate data If my travel programme is fragmented to a large number of suppliers?

A:  There are a number of areas to collate data these could include:

Incumbent travel agencies

Corporate card data if you have a consolidated card programme

Expense reporting from back office systems

Data Collection Templates to be sent to local stakeholders