Discuss the overall expectancy of your business with any new source, regardless of the geolocation. Institute a cost breakdown template as part of your RFQ’ing process as a must do, raw materials have to include clear acquisition cost, and index used if any, preferably must have it, back up with quotes of the raw material. Generate your own should cost modeling to identify potential unit cost and benchmark. Track market trends constantly to validate correct values. Set contracts or open purchase orders with clauses that ensures transparency, must be acknowledged and signed. All must be documented and filed in your ERP data base along any digital platform library and accesible to all purchasing group for scrutiny.

❶ Use a standardized RFQ template that specifies exact requirements ( materials, specifications, quantities, delivery terms, payment terms). ❷ Utilize procurement platforms or marketplaces that offer price comparisons, historical data and analytics. ❸ Implement tools with features like automated bidding or reverse auctions to drive competitive pricing. ❹ Negotiate with suppliers to provide cost breakdowns for materials, labor, overhead, and profit margins. ❺ Establish trust by positioning this approach as mutually beneficial, fostering long-term partnerships. ❻ Conduct market research to benchmark prices against industry standards or regional norms. ❼ Use third-party databases or consultants for up-to-date pricing trends and insights.

Creating price transparency with customer is essential to building trust and fostering a collaborative relationship. some steps can take: 1. Break Down Costs Clearly to customer 2. Use Open-Book Pricing to understand 3. Leverage Benchmarking data for creating trust 4. Incorporate Digital Tools for Use pricing or real-time changes in costs of Raw material. 5. Communicate Regularly to customer if any fluctuations to mitigate cost impacts. 6. Agree on Pricing Models with the customer on a pricing structure that aligns with customer expectations. 7. Share insights on where costs can be reduced without compromising quality.

As technology has evolved, so have been the global supply chains. Right sourcing at the right time and right price from the right source is no more a theory. Organisations and buying managers are sourcing products and services from all around the globe. One of the biggest challenge is how to ensure transparency. First of all, a very strong sourcing policy should be in place clearly defining tasks and responsibilities. Buying process should be system dependant rather than people dependant. E-procurement or reverse auction may be implemented. Detailed cost break up to be sought from vendors. All fixed and variable cost indices to be identified and periodically monitored.

Also do not forget to use conversion rates to standardise all currencies as well as incorporating applicable incortems so that your landing price will be realistic as well as avoiding misunderstanding between the buyer and seller.Remember you are responsible for keeping long lasting relations with reliable suppliers