Soluparts: Our Value Proposition

Soluparts: Our Value Proposition

Soluparts is an international trading company specialized in purchasing and delivering all types of industrial materials (MRO – Maintenance, Repair, Operations). Our dynamic team and modern systems enables us to offer a fast and reliable service to all our clients. See below what makes us unique.

1- We are agile

Our branches in the US, Germany, Brazil, Portugal and Hong Kong allow us to optimize and leverage materials purchasing and sales logistics, providing our customers with the best supply chain service in the industry: fast, reliable and modern.

2- We connect you to the 5 continents

Soluparts helps you reduce the number of international suppliers, since we have branches in the most competitive markets in the world. Your quotation will reach the most relevant manufacturers on the five continents, and you as our customer will only need the paperwork and time spent on one quotation. Our relationships and connections allow us to find any brand and product you need.

3- Manufacturer warranty

We offer the same warranty as the manufacturer. Should any mishap occur, our customer contacts us directly and we will solve the problem.

4- Experience and trust

Companies in various industries work and trust Soluparts. They know we always achieve expressive results. We have competitive and reliable suppliers in every segment and by decreasing your numbers of registered suppliers you also decrease risks of dealing with many different manufacturers..

We also rigorously check all incoming and outgoing products from our warehouses, ensuring that items shipped to the customer meet their requirements, reducing unnecessary expenses on returns.

5- We are facilitators

We help our customers purchase spare parts and effectively reduce prices, delivery time and bureaucracy. Our customer gathers all their demands in a single quotation request and we will take care of all contact with the various manufacturers, as well as in selecting the best prices and conditions in the market. This reduces ours client’s time in searching and comparing quotes with multiple suppliers. We also do cargo consolidation reducing costs and delivery time, ensuring the best terms.

6- Premium customer service

We have a multicultural and international team, prepared to help you in the best way and in several languages. Each of our consultants knows the needs of each client closely. They are experienced professionals with unlimited access to over 15,000 brands, with the daily mission of offering you the best prices and best market conditions.

Our logistics and purchasing departments are highly efficient, maintaining direct contact with our customers’ logistics departments to ensure all export documents and procedures are following their requirements.

How can we assist you? Do you face any other issues that we do not address in this text? We have experience in solving foreign trade issues and will be able to help you with what you need. Never again will a part be missing from your factory! 

Let’s talk?

 

Why-is-the-purchasing-department-so-strategic

7 strategic KPIs for the purchasing department

Do you know what the best strategies have in common, other than absolute success?

Some researches show that more than half of the companies consider themselves more successful just because they keep a closer look on performance indicators. And those companies are not wrong!

Basically, keeping a closer eye on performance indicators is the best way to determine the results of your strategy – which decisions were right, which were not, how much money was saved or lost in the process… It’s all about the data!

Within a company, every department has its own indicators, which display the quality and efficiency of the work. Which indicators are used to measure the performance of your department in your company?

Here, we like to use KPIs!

Key Performance Indicators

Key Performance Indicators (KPI’s) are a group of parameters used to evaluate the performance of different areas of an organization. This type of management emerged in the early 90s, and is now considered the best way to keep up with the most important metrics in each sector of any business.

KPIs are relevant not only because they allow measurement and performance evaluation in each department, but also and mainly because they make it easier for the manager to see where are the rights and wrongs, and which areas need more investment and attention.

KPIs in the Purchasing Department

The purchasing department is one of the most important in any business, be it large or small. This sector is responsible for mediating the company’s relationship with suppliers: from the choice of best supplier at the best price and quality required, to the control of performance standards, without an effective management the purchasing department is left disorganized and can be accountable for large losses – and even the bankruptcy of the company.

To measure up the performance of the purchasing department, KPIs cannot be forgotten! Let’s go through the 7 most essential KPIs to keep up with the purchasing department:

#1. Delivery

This KPI measures how well the purchasing department is when it comes to finding what the organization needs when it needs it.

How to measure: Number of on time deliveries / Total number of deliveries per supplier

Important: the company should not penalize a supplier for missing delivery dates if the lead time required by the supplier is not complied by the company or a change was requested at the purchase order. These two situations need to be taken into consideration when calculating this metric.

#2. Cycle time

It’s the average amount of time spent between the moment when the requisition from another department is submitted and the placement of the purchase order. In other words, the time the purchasing department takes to fulfill the needs of the organization.

How to measure: Moment of purchase order placement – Moment of requisition submission

This metric is usually measured in day and it excludes the supplier lead time.

#3. Supplier lead time

It’s the average amount of time spent from the moment of the order placement until the delivery.

How to measure: Moment of delivery – Moment of order

This metric is also measured in days and must be measured per supplier. It relates directly to the Delivery KPI.

#4. Quality

It’s important to keep track of the quality standards, which means knowing exactly if the goods purchased fulfill the needs of the company. If they do, great. If not, a change of supplier may be necessary – read here about compliance in the purchasing department.

How to measure: Amount of rejected items / Total amount of items ordered

This metric is usually calculated on a monthly basis.

If the percentage is too high, an analysis must be held to determine why the items are being rejected – if it’s due to problems with the supplier, with the purchasing orders or something else. To improve your purchasing department’s strategy read our article about Strategic Sourcing.

#5. Inventory risk

The obsolescence of goods is a real problem for companies that make large purchases. Over time, the entire inventory can become obsolete, and the money spent to buy and maintain them goes down the drain – read here the applications of the Opex and Capex concepts, considering the 4.0 Industry era. 

How to measure: Amount of money lost due to obsolescence / Total worth of the inventory

This metric is usually measured on a monthly basis, but could also be by trimester or semester.

Soluparts can help you find obsolete spare parts: send us a request for quotation. 

#6. Employee Learning

This metric should be used more by all companies, big and small. Here, the purchasing manager must verify if the personnel are striving to deliver more quality and efficiency at work.

Keep tabs on the number of purchasing employees with certifications that improve their performance on the job. The certifications can be college degrees, participation in lectures, specializations, MBAs, etc. The more they search for knowledge and improvement, the better for the company – check out 3 essential skills for purchasing professionals to stand out in the digital age.

This is a very good way to find out if the team feels motivated and driven, and also to reward the employees who show the biggest efforts of improvement. Finally, it’s an easy way to realize the need to provide training to the team.

#7 Cost

Here, we are looking at 3 metrics.

Number one is the Cost Avoidance, that helps the purchasing team find the lowest price for the same good among suppliers.

Here’s how you calculate it: Actual Purchasing Price – Lowest Price Quoted

Number two, Cost Saving. This indicator differs from the latter as it shows how much the department has been able to save when buying the same good, from the same supplier, for the second time, for a lower price. It demonstrates how well the department is at negotiating.

It can be calculated as: Actual Purchasing Price – Last Price Paid

Last, but not least, is the well-known ROI, Return Over Investment. It shows if investments were made wisely, if the return is positive. If it’s negative, it means that something went wrong in the process, and the company is losing money – See here the best way of comparing quotation.

ROI = (Cost Saving + Cost Avoidance) / Cost of Purchasing Operation

Conclusion

These 7 are just examples of KPIs that you should follow in your company!

By keeping up with these indicators, your purchasing team will be able to better understand the purchasing habits of the company, the performance of suppliers and if the procedures are working as they are supposed to. This way, it becomes easier to make changes in staff, reallocate investments, and, in short, assess the issues and find the appropriate solutions.

Other than analyzing KPIs do you keep up with the new technologies for the purchasing department? We have some articles in this regards you will enjoy reading:

The purchasing sector in industry 4.0
Benefits of an intelligent supply chain
The second wave of industry 4.0

Soluparts – a global company with offices in Brazil, Germany, Portugal, Hong Kong and the United States – can connect you to the most relevant manufacturers around the world.

We specialize in purchasing all types of industrial materials and have access to thousands of products and suppliers from around the world – Send us a request for quotation.