Financial services procurement for distributed locations
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Distributed locations procurement
for financial services
Distributed locations procurement
for financial services
The challenge of supplying distributed locations
As of 2023, there are nearly 70,000 FDIC-insured commercial bank branches in the United States. The largest bank in America operates 4,897 locations alone. The logistics of supplying so many distributed locations, whether a bank, credit union, or insurance provider, are challenging. The geographic spread of these locations means that procurement professionals must navigate logistical and administrative challenges, including:
- Diverse needs: Different locations may have unique requirements based on their operational focus, local regulations, cultural norms and staff numbers
- Communication barriers: Coordinating procurement activities across time zones and languages can lead to misunderstandings and delays
- Logistical complexities: Ensuring timely delivery of goods and services to multiple locations requires efficient supply chain management
- Cost management: Variations in local market prices and currency fluctuations can impact procurement budgets
In response to these challenges, many business buyers in financial services organizations find their tail spend, which encompasses all low-value and decentralized purchases, difficult to manage. Worse yet, rogue spend, which refers to unauthorized or non-compliant purchases and is a subset of tail spend, creates substantial cash leaks due to inefficient business purchasing practices. The Hackett Group found 16% of negotiated savings are lost due to rogue spend, with 75% of respondents citing lack of self-service buying tools as the primary cause. Amazon Business provides a solution to rogue spend through smart business buying.
The risks of rogue spend
Poor procurement practices can lead to several inefficiencies, including:
- Overspending: Without proper oversight, procurement costs can increase, impacting the bottom line
- Quality: When employees make purchases outside established procurement channels, it can lead to inconsistent product quality or untimely deliveries
- Low employee morale: Inefficient procurement processes can frustrate employees, leading to decreased productivity and morale
Amazon Business provides solutions for financial services procurement
Amazon Business offers a suite of tools and features designed to address the unique challenges financial services procurement for distributed locations.
Guided Buying
Guided Buying is available exclusively to Amazon Business customers with a Business Prime membership. Financial services organizations can assign an account administrator, who can identify products and suppliers the organization prefers such as those that are Climate Pledge Friendly, from small and diverse sellers, and from local businesses. When shopping, buyers will see products badged as preferred by the organization show up in their search results. Account administrators can also identify and restrict certain product categories. Customers with the Business Prime Enterprise Plan have exclusive access to block products to help buyers avoid products and sellers they should never buy. You can learn more about Guided Buying in our Guided Buying overview video.
Analytics and reporting
For financial services organizations, it is all about the numbers. That is why Amazon Business has a suite of analytics and reporting tools to help make data-driven procurement decisions. Spend Visibility, a Business Prime exclusive, helps buyers identify, monitor, and track business spend with pre-built reports and dashboards. Supplier Analysis can help buyers get a full view of their tail spend for the first time, as well as address contract leakage and uncover hidden freight costs. You can learn more about analytics and reporting by watching our Amazon Business Analytics video, or by viewing the Amazon Business Prime overview video.
Integrations
Contracts, existing relationships, and reputation are important to financials services organizations. That’s why Amazon Business provides robust integrations support for existing systems. Single Sign-on (SSO) enables financial services organizations to streamline onboarding, increase security, reduce risk, and enable one-click access like other corporate applications used daily. Similarly, Punchout integrations, which can be paired with SSO, allow financial services organizations to keep existing approval workflows from over 150 existing procure-to-pay systems across the globe, while still buying from Amazon Business. Learn more from our e-procurement video.
Conclusion
“Rogue spend” is not a term anyone wants to hear in the same sentence as “financial services.” With Amazon Business, financial services organizations can address rogue or maverick spend in their organizations distributed locations with tools like Guided Buying to set purchasing guardrails, Spend Visibility to track spend in pre-built dashboards, and integrations like SSO to make it easier than ever for employees to adopt new buying policies. Not only will these tools help financial services organizations control rogue spend across distributed locations for bottom line improvements, but they can also streamline more procurement processes with the full set of features on Amazon Business.
