Company News

New Year's Resolutions For Your Multifamily Housing Purchasing Program

by Michelle N. on 1/2/2014 7:04:00 AM

“In 2014 I resolve to improve NOI. I will review, revise, and implement a more cost-effective purchasing program for ABC Management.” 

It's that time of year again. Does the above statement sound familiar? We all make a number of personal and professional New Year's resolutions. Unfortunately, we fail to chart the specific and attainable steps necessary to successfully achieve those goals. Buyers Access suggest the following to help optimize your purchasing program in 2014:

Review & Analyze – Perform a complete review of MRO (Maintenance, Repair, Operations) spend for 2013.  Evaluate each property’s expenses and number of vendors used.

Consolidate & Standardize – A reduction in the number of suppliers, and different product brands/styles = standardization.  This results in a reduction of invoice processing, inefficient inventory, and time.  Time = Money

Utilize e-Commerce Technology – By implementing a configurable, electronic purchasing platform, you can gain spend control, standardize, and reduce processing costs per invoice. The average process cost per paper invoice is $18.  The average cost per electronic invoice is $3*. Savings of $15 per invoice.

Negotiate Pricing & Value Added Services – Review your current vendor pricing and discounts.  Does that vendor offer value added services (free shipping, rebates, training & reliable customer service)? Schedule meetings with your preferred vendors to review your current purchasing programs.

Implement Your Revised Purchasing Program – Rollout your new purchasing program and procedures to each property.  Include initial, and on going training to all property personnel, schedule quarterly updates, and performance reports.

Be Realistic & Honest - Do you and/or anyone in your organization have the time to review, develop & implement these necessary steps?  Consider the real value of a reputable Purchasing/Spend Management Consultant, like Buyers Access. Our average member realizes a NOI of over $50 per unit per year.                            

To learn more about other cost/time reducing strategies and services that Buyers Access can offer, contact us.  We look forward to hearing from you, and wish you healthy and prosperous New Year.

*Purchasing Today –Volume 10, Number 4, Page 18