The demand of medium-sized businesses for the various services of management consultants also says a lot about the related economic trends. For example, the information chart on the current company figures of the purchasing specialist Kloepfel also reflects clear trends in medium-sized purchasing.
Across all companies, the Kloepfel Group acquired a total of 134 new customers in 2018. This is a new record for the full-service purchasing service provider and also shows that purchasing is becoming increasingly important for SMEs. In this article you can read about the biggest challenges and most important trends in purchasing in 2019.
2019 will be a good year for buyers
Under the slogan “Renditemotor Einkauf” (“Purchasing as a yield engine”), Kloepfel Consulting has further expanded its role as one of the fastest growing purchasing consultancies in the German-speaking region. In 2018, the purchasing specialists were commissioned with 110 cross-industry projects to optimize purchasing conditions and purchasing processes.
“A particular challenge for purchasing in 2018 was clearly the good economic situation. We had a seller’s market and many medium-sized companies were struggling with rising prices but also with supply bottlenecks. Nevertheless, we were able to achieve savings of around 160 million euros with around 150 employees. We expect the economy to weaken in 2019. The procurement markets will thus relax and buyers can expect a good year” says Marc Kloepfel, managing director of Kloepfel Consulting and CEO of the Kloepfel Group.
“My tip for purchasing: Despite a promising year, start a cost offensive against suppliers at an early stage. Suppliers should be aware that predictable customer relationships are of great importance, especially in weaker times. In addition, many of them have expanded their production and now need to use this capacity. Even simple tools such as cash discount optimization are strong levers in purchasing. If you have enough liquidity, then use punctual payment to be rewarded with high discounts” continues Marc Kloepfel.
Lack of skilled workers: Investments in people pay off
“What we advise our customers, we experience ourselves day after day. Investments in employees and good leadership are paying off. In 2018, the work of our teams was once again awarded the industry prize and the seal of quality “Best Consultant”. Both awards clearly show that the market appreciates our investments in our employees” says Duran Sarikaya, managing director of Kloepfel Consulting. “All the more reason for us to be pleased that in 2018 we were also able to attract many new, highly motivated talents to continue our growth course in the coming years.
Marc Kloepfel adds: “Without talent there is no purchasing and no purchasing optimization. We are therefore pleased that more and more university graduates are interested in purchasing and the consulting business of our companies. The profession has become much more attractive in the last ten years. But we also scored well with experienced purchasing managers. Many of our employees recommend us as an employer because they appreciate the learning curve and development opportunities of our challenging projects as well as our cooperative company spirit”.
Purchasing processes: Focus on process costs
Christopher Messina, managing director of Kloepfel Services, sums up: “Our customers have recognized that it is no longer enough for them to improve their purchasing conditions exclusively. It is at least as important for them to digitize their operative purchasing processes. They can then react more agilely to customer wishes and market changes. Secondly, in times of a shortage of skilled workers, they can, for example, set up an operative buyer for strategically more important and value-adding tasks. In addition, companies are increasingly learning to appreciate the value of the data generated by digitization. For example the development of new products and the management of purchasing and logistics become way easier.”
Digitization: Master data is the biggest problem
“The problem of many companies is still the quality of their master data. This is why Kloepfel Services also helps companies to prepare their master data in such a way that digitalization is also possible for them” says Christopher Messina. “If you try to set up digital projects and optimize master data at the same time, this creates chaos, unnecessary additional costs and frustrated employees” warns the expert.
Middle class 2025: Strong as a big group – agile as a start-up
Messina continues: “Kloepfel Services (purchasing outsourcing, interim management), proctopus (purchasing digitization, purchasing association) and Kloepfel 4PL Solutions (logistics optimization, customs and foreign trade, intralogistics) have grown strongly and now have 35 employees who served more than 50 customers in 2018. With our solutions, our customers become as powerful as a big group and as innovative and agile as a start-up. Combined with their wealth of knowledge and their entrepreneurial values, this is exactly what makes the SMEs of the future for us”.
Kloepfel Engineering: Products increasingly on trial
Manfred Esser reports: “We clearly feel that the demand for product cost calculations, value analyses and technical optimizations is increasing. In 2018, we managed 30 projects. Many entrepreneurs want transparency about the cost structures of their own products, but also about those of their suppliers”.
In 2018, the Cost Control calculation tool was again honored with the Industry award and the Innovation award. Since 2012, Cost Control has received a total of 14 awards.
With the online software, companies can analyze their target costs and design products cost-consciously and efficiently (design to cost). Cost Control also helps companies to optimize their production and provides technical purchasing with answers to cost questions while at the same time improving quality.
Material savings of between 5 and 10 percent and total savings of around 10 to 40 percent are common. This means that the investment pays for itself quickly: after just one week of training, 50 percent of the cost savings can be realized and the acquisition costs can be saved again.
War of Talent: Optimization of wage costs in high demand
Especially in the War of Talent, companies are looking for solutions to increase their attractiveness as an employer brand. In this context, Kloepfel HR Solutions supports HR administrations in developing solutions in the areas of compensation and benefits and implementing these in the companies. The mission of Kloepfel HR Solutions is to optimize wage cost structures holistically and sustainably and to reduce ancillary wage costs. Together with specialized tax experts and lawyers, Kloepfel HR Solutions develops new future-oriented strategies for HR processes. In 2018, HR Consulting supported a total of 24 projects and over 21,000 employees. The savings in personnel costs amounted to around 11.5 million euros.
Kloepfel Recruiting: Buyers salaries rise
Kloepfel Recruiting, as one of the leading recruiting specialists for specialist personnel from purchasing, logistics and supply chain management, placed a total of 35 top-class specialists and managers in 2018. The recruiting team is rewarded on a success basis and fills its clients’ vacancies within six weeks of placing the order. Kloepfel Recruiting uses its exclusive database with over 30,000 CVs of experienced buyers and supply chain managers. In their day-to-day business, but also in the annual purchasing salary report, Kloepfel Recruiting noted that the salaries of purchasers rose again in 2018, but that female purchasers still earn significantly less than their male colleagues.
Which topics will be important for decision-makers in 2019?
Duran Sarikaya says “Like most experts, we expect the economic upturn to slow and so companies that used to have been successful will have to reckon with sales setbacks. As a result, companies will once again focus more on the issues of cost reduction and working capital. We have noticed that companies have lost sight of these two goals in the good times. The variabilisation of fixed costs will also play an important role for decision-makers in 2019. Many companies have recently taken on more employees. If sales decline now, this will have a fatal effect on earnings development, especially in the case of rising collectively agreed wages.”
Marc Kloepfel explains: “Product innovations as well as product relocations will also become important, because long-term competitiveness can only be maintained through consistent rethinking of product complexity, one’s own purchasing and corresponding make-or-buy measures.”