October 31, 2012
The recession continues to haunt clients and they are particularly squeamish about any major procurement transactions. Your client’s angst provides an opportunity for you to show value and you will hopefully be asked to become involved in a variety of different transactions that are related in some manner to the purchasing function and its business goals and objectives. Examples of the issues that might arise include:
- Negotiating and documenting contracts with suppliers to provide materials that can be used by the company in its internal manufacturing activities;
- Assisting purchasing professionals with the preparation of requests for bids, purchase orders and standard terms and conditions that can be used in connection with isolated, or one-time, purchases that do not require a long-term contract;
- Working with purchasing professionals and company engineers and designers on customized procurement contracts pursuant to which suppliers provide parts and materials that are built to meet the company’s unique specifications;
- Providing guidance on compliance with laws and regulations applicable to the purchasing function, including the law of sales, antitrust laws, product-testing requirements and the like; and
- Negotiation and documentation of contracts for assets and services ancillary to the purchasing function, including transportation, storage, and inventory management.
You can also provide assistance in other areas relating to the purchasing function. For example, when the client is evaluating a potential outside supplier for a long-term relationship, you can participate in the legal and business due diligence investigation of the proposed supply chain partner. You can also be extremely valuable when the company is looking to use foreign supply partners, which is a common strategy for reducing production expenses by taking advantage of lower costs of labor and materials in foreign markets. In that situation, you may actually find that the best method for proceeding is formation of a joint venture, a process that raises its own unique set of legal and regulatory issues.
Find out who is in charge of the procurement function for your major clients and make an appointment to discuss with them how you can help their bottom line and take some of the risks out of what is always a major investment of capital and time.