GPI 255 – Ask your purchasing agents for 3 bids on all purchases. Just talking to vendors will wake him up.

See the reaction when you ask for 3 bids on all purchases from your Purchasing Department.  Unless you have them on a very specific bonus program, it will not happen.

Reasons you will be given for why your agent cannot get three bids: 

  1. We are too busy.  Do you want me to get my work done or do you want all these bids?  (If you are too busy, we need to analyze what keeps you busy so you can get more bids.  If you are overwhelmed, we will get an assistant to make calls.)
  2. You do not understand the market.  There are not enough bidders out there for this type of bid.  (You will not know what is out there until you make a number of calls and make an effort.)
  3. You are not going to get three bids, or should I say, three real comparable bids.  We are unique and no one does what we do.  (Everyone has a distorted view of their job, their company and their abilities.  the more you speak with outside vendors, the job that needs to be done, the product that needs to be purchased becomes more clearly in view and understood.)
  4. Other vendors cannot meet the demands of our company.  (No one knows that until he has made numerous calls in the market and asked for bids.)
  5. You are asking me to do something that we may live to regret.  We cannot replace critical vendors we now have in place.  (If you have vendors that threaten your company’s existence, you need to start looking for new ones today.)
  6. If we bid out this work, our current vendor will get mad and leave.  You do not want that do you?  If that happens, are you going to take the blame because, I do not want to be blamed for this mistake.  (This is all the reason more to start looking for alternative bids.  This is a very short-sighted view of the marketplace and suggests possible collusion in your purchasing department.  Let a third party get some bids. you need to assure yourself your purchasing agents are working only for your company.)

All of these are signs your purchasing personnel do not understand why they are hired and for what purpose.  Calling for three bids will wake up your purchasing agents to the actual marketplace. Every call tells your agent 1.) pricing differences, 2.) better understanding of the product / service to purchase, 3.) more options that are available not mentioned by the first guy.