09
Apr

In Part III of this series, I revealed that using masternegotiator.com resulted in us getting an attractively priced office supplies proposal that was very close to the one we got on our own, but that the masternegotiator.com deal was a lot less work. In the last post, I indicated that the masternegotiator.com deal “appeared” to cost us a mere hair more than the deal we got on our own – $159.47 to be precise.

But, after closer evaluation, the difference was even smaller.

You see, there is something else to be aware of when sourcing office supplies. The fine print.

I can’t call fine print a dirty trick necessarily because suppliers do disclose terms in fine print. And it is part of a procurement professional’s job to thoroughly review every single word of a proposal, even the fine print.

What does the fine print cover?

In this case, it was a statement in Staples’ direct proposal to us that all prices were fixed except for certain specified items, notably toner.

One of the subcategories where we have some noteworthy spend is indeed toner. It turns out that January 1 was the date for toner price increases. That day happened to be between the time we got Staples’ original proposal in late 2008 and the time we got access to the masternegotiator.com deal in early 2009. So, if we take out toner – assuming that the price in the original proposal would have been adjusted to equal the masternegotiator.com deal – the delta now shrunk to $27.21 per year.

But, wait a second, we also got a $25 Staples gift card as part of the deal. That has to be factored into the total cost of ownership, right? So the first year delta was more like two bucks.

Now, this isn’t a two-buck delta between calling Staples and saying “give me pricing” and masternegotiator.com’s leveraged deal. This was a delta between masternegotiator.com’s leveraged deal and a big-company-style sourcing process where the supplier did their homework and learned the influence that Next Level Purchasing has in the procurement community.

And SourceOne even audits the pricing granted via masternegotiator.com deals. Seasoned office supply sourcing professionals know that the importance of auditing office supply contracts can’t be understated, as emphasized in our PurchTips article “Office Supplies Sourcing Secrets.”

Back to the fine print…Beware of the fine print and don’t let your internal customers be surprised by a price increase that you, as a procurement professional, should absolutely be anticipating!

Obviously, it is best to not have price increases. And it’s the next best thing to have price changes made in accordance with a third-party index so that price changes are fair and predictable.

OK, enough with the dirty trick rant. So, where did we end up with our office supplies?

After discussing with Staples the differences between the masternegotiator.com deal and their original proposal, they kept the lower prices lower and adjusted the pricing on a handful of other items so that we ended up with a better deal than their original proposal (removing toner from the equation). All told, we saved about 33% on our office supplies in terms of year-over-year spend.

I can’t say with absolute certainty that the masternegotiator.com deal would be the best for you. But I can tell you that we’ve tried it and it earned my seal of approval.

NOTE: While SourceOne is a sponsor of this blog, I think that it is an important thing to point out that Next Level Purchasing gets no revenue from the sponsorship. We simply trade logos on each others’ blogs. And, most importantly, we have no financial interest in masternegotiator.com or its success. I just wanted to give you an honest review of my experience so that you can integrate it with your other sources of information when sourcing your own office supplies.

To Your Career,
Charles Dominick, SPSM
President & Chief Procurement Officer
Next Level Purchasing, Inc.
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Charles Dominick, SPSM, SPSM2, SPSM3

Charles Dominick, SPSM, SPSM2, SPSM3 is the President & Chief Procurement Officer of the Next Level Purchasing Association. Charles is also the Co-Author of "The Procurement Game Plan".

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