Purchasing is a visible cost in the budget. Less visible is how unstructured purchasing data...
Procurement affects more than the cost base. When purchasing becomes easier to understand, it is quicker to spot deviations, price differences and unnecessary work. For businesses, that can strengthen profitability and room to invest. In municipalities and regions, the same improvements can create more space for the services that people rely on every day.
Small improvements add up quickly
A typical Swedish public-sector customer of Xpendio may have annual spend of around SEK 1.5 billion.
Xpendio’s experience is that better analysis and visibility can create an effect equivalent to at least five per cent of total spend. In this example, that amounts to SEK 75 million.
Better procurement and negotiation can add another five to ten percentage points.
The outcome will vary from one organisation to another. But the scale is worth noting: even relatively small improvements in procurement can have a significant effect on both finances and the organisation’s ability to act.
The opportunities are often hidden in everyday purchasing
The greatest opportunities are not always found in one large contract. More often, they appear in patterns that build up over time and are difficult to see when information is scattered.
Three examples come up repeatedly:
- No contract is in place
Goods or services are purchased regularly without a clear agreement. - Prices vary
Similar products or services are bought at different prices across the organisation. - Purchases are made outside existing contracts
An agreement exists, but purchases are still made from other suppliers or on different terms.
These patterns are difficult to identify by reviewing invoices one at a time. Once purchasing data is brought together and categorised, they become much easier to see — and act on.
Visibility frees up more than money
Better visibility does not only affect costs. It also reduces the time spent searching for figures, comparing different sources and trying to decide which information is correct.
Errors become visible earlier. Procurement processes can be prepared using actual volumes. Supplier discussions can be based on prices, purchases and deviations rather than assumptions.
That means less administration and more time for analysis, follow-up and decisions that require experience and judgement.
When more of the budget reaches the work itself
A saving does not determine how the money will be used. That remains a decision for management and, in the public sector, political leadership.
But better procurement creates more room to act.
It can mean less money tied up in unnecessary costs for materials, systems and services. It can reduce the risk of expensive deviations or disruption. It can also help ensure that more of an investment reaches the work or project it was intended to support.
The budget is the same. The difference is how far it goes.
The same data makes sustainability more practical
When an organisation can see what it buys, from which suppliers and within which categories, it also becomes easier to set sustainability priorities.
It becomes possible to identify which areas have the greatest impact, which products could be replaced and where new requirements could make the biggest difference.
Sustainability then becomes less of a broad ambition and more of a practical choice in the next procurement process.
From insight to results
Visibility is only the beginning. For insights to lead to results, purchasing data needs to be usable, contracts need to be practical to follow and ways of working need to function in everyday operations.
Procurement, finance, operations, sustainability teams and management also need to work from the same picture. When they do, it becomes easier to prioritise, act and follow up.
Better procurement will not solve every challenge. But it can help more of an organisation’s resources reach the work they were intended to support..
