Level 4+ categorization and granular data lead to faster problem identification and increased procurement savings. Most procurement teams follow the following process to get the granular data needed for the most accurate results. With better management of your preferred supplier program, teams can reduce rogue spend Sales Forecasting and identify opportunities to drive savings and value. Spend Intelligence helps procurement teams proactively manage expiring contracts, identify consolidation opportunities, and drive greater value. Companies of all sizes and types can achieve effective and accurate spend analysis by following a series of simple processes based on spend cube analysis.
- Along with the code, you can include written explanations, images, or charts, which helps keep your work clear and well-documented.
- It is very time-consuming, but you can classify data in a few hours if the dataset is small.
- The table below outlines key types of spend analysis, their core objectives, enterprise impact, and KPIs that help you track progress, so you can focus on the strategies that drive real business outcomes.
- This, in turn, makes it easier to identify opportunities for cost savings and mitigate financial risks.
Supplier Performance
The tool’s analytics dashboards offer insights into Accounting Periods and Methods supplier risk profiles, performance trends and compliance gaps so you can make smarter, safer sourcing decisions and avoid disruption before it happens. Supplier performance and risk analytics platforms track how well your suppliers are delivering – literally and figuratively. They analyse everything from delivery timelines and quality issues to financial stability and compliance risks to help you assess who your most reliable partners are. Zylo is a SaaS management platform that gives businesses complete visibility over their software subscriptions. From identifying duplicate tools to uncovering underused licences, Zylo helps you get your SaaS spend under control.
Collect Data from Multiple Sources
As the data is collected and analyzed, spending patterns and trends become apparent, revealing cost reduction and savings opportunities. This question helps organizations to understand their historical spending patterns and identify areas where they can save money. While not exclusively for spend analysis, business intelligence tools offer powerful data visualization and analysis capabilities applicable to various business functions, including procurement.
any category or industry with advanced filtering, real-time search capabilities, and
The goal is to identify unnecessary expenditures, negotiate better rates, and optimize service contracts. GEP SMART’s built-in AI scans through your spend data to identify potential savings opportunities based on your sourcing strategy. Comprehensive spend analysis delivers detailed, real-time visibility into purchase data, providing the insights essential for automated spend analysis effective strategic sourcing programs. Thus, you can more effectively address supplier issues and increase supplier satisfaction.
Sources of Spend Analysis Data
Enriched spend analysis allows you to track supplier concentration, evaluate risk indicators such as delivery delays and non-compliance, and monitor ESG performance against internal or external benchmarks. For instance, by mapping spend data to supplier risk scores and sustainability certifications, an organization can proactively adjust its sourcing strategy to avoid ESG-related regulatory exposure. Many spend analysis tools use rigid, opaque classification, making it hard for stakeholders to trust or validate the data. If teams can’t explain how categories like marketing or legal spend are assigned, they won’t act on the insights. Transparent, configurable classification is key to building trust and driving adoption. These real-time dashboards offer a centralized view of all procurement activities, allowing your teams to analyze spending patterns, identify trends, and track performance indicators.
- By surfacing spend patterns and tracking them against budget, you can forecast future needs more accurately and ensure procurement remains a strategic partner to finance.
- Many spend analysis tools also offer real-time data synchronization, ensuring up-to-date insights for financial planning.
- The image below shows how Sievo’s Self Service Craftboard allows you to build reports to meet your specific needs.
- It enables businesses to make data-driven decisions that optimize their supplier base, improve procurement outcomes, and strengthen their position in the marketplace.
