Smaller businesses don’t have the same resources as large multinationals when it comes to their procurement, and because of this, they often miss out on the best deals. Larger companies have the muscle to have entire procurement teams working on contracts, alongside access to mountains of data and spending power to get themselves the best possible price for essential materials, technology, products and services. Smaller businesses which are often owner-managed sometimes struggle to get this essential aspect of the business right and are prone to overspending on their essentials.
Enter MyProcurement, a Caerphilly-based startup founded by Phillipe Mele (above) which aims to take the headache out of procurement for smaller businesses – and potentially larger ones too. The company works on a simple “no savings, no payment” basis, and primarily deals with companies in the engineering and manufacturing sector.
Mele has worked on procurement at high-profile international brands, including EDF Energy and Tata Steel, but also finds working with smaller companies appealing. “When you work with smaller businesses and save them money it can feel more rewarding,” says Mele. “What I do for small businesses is helpful to them as they often don’t have time to do cost reduction,” he adds.
Services offered by MyProcurement at present include Operating Expenses Reviews, which take a close look at costs that are incurred as a result of a businesses’ day-to-day operations – these might include production materials, consumables, and utilities. MyProcurement claims that it can help achieve between 10-30% savings on these sorts of expenses. Capital Expenditure reviews, on the other hand, take a look at anything from new facilities, machine upgrades, office refurbishments or computers, for which MyProcurement can also assist in finding better deals. As part of its outsourced procurement offer, the company will also seek to add extras for your company from suppliers, like year-end rebates or employee discount schemes.
While the company is still in its start-up phase, Mele envisages that more automation and software will come into play as it evolves – an alpha version of software is currently in the works and is on course to run by the end of December. For Mele, incorporating an element of automation in to at least some of the procurement process is a natural step – but there is also a vital role for humans to play which machines aren’t able to replace. “The idea is to develop software to help SMES reduce costs through artificial intelligence,” he says. “Procurement has an analytic aspect, and a relationship management aspect – the analytical side is better with a machine as they make less mistakes. Automating the analytics will allow you to focus on the relationship management element, which will always need humans.”
As the company looks to grow, Mele decided to join ESTnet in order to increase its network and influence. “The engineering sector in Wales is massive – as you could see at the Factory of the Future event,” he says. “Events like these bring people together and show that we’re not alone here.”