Supplier Employment: This Year's Biggest Risk?

Do Your Suppliers Have Enough Workers?

PurchTips Edition #402

 

Last week, the United States government released a shocking statistic:  the US unemployment rate had dropped to 3.8%.  The rate had only reached this low of a level in one prior month since the 1960’s!  Other countries throughout our global economy are seeing similarly high employment levels.

For the general population, this is good news.  It means that jobs are available and pay rates are relatively high.

For procurement professionals, this is bad news.  It means that suppliers are likely to have trouble finding workers to continue to fulfill your orders.  In fact, this is a potential crisis.

Procurement professionals like you need to be more vigilant than ever when sourcing.  You need to probe specifically how your suppliers are handling the challenges of this hot economy and how well-prepared they are if it gets hotter.  Here are some questions you can ask your suppliers:

  • What percentage of your full-time equivalent positions are currently open?
  • How does this percentage compare with a year ago? Two years ago?
  • Statistically, how is the tight labor market impacting your lead times and on-time delivery percentages?
  • What are you doing to retain employees?
  • What methods are you using to attract new employees?
  • What are you doing to prepare for an even tighter labor market in the coming year?

There are really no right or wrong answers.  But comparing answers of competing suppliers will reveal which suppliers are managing today’s economic challenges and which are more likely to crack under the pressure of a tight employment market.

Want a More Rewarding Procurement Career?

Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.

Earning your SPSM® Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential.
Download the SPSM® Certification Infopack today to learn how to get started on your journey to a more rewarding procurement career!

Download

Need Better Results From Your Procurement Team?

Are you a procurement leader whose team isn’t achieving the results you know are possible? Maybe it’s not enough cost savings. Or poor supplier performance. Or unhappy internal customers.

You need a performance improvement plan that’s easy to implement and quick to produce results. The NLPA can help.

Download our whitepaper “The Procurement Leader’s Guide To A More Successful Team.” You’ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.

Download


final

Want to get more procurement articles by email for free?

Members of the NLPA get great articles just like this by email every two weeks. As a member, you will also get access to:

And the best part is that membership in the NLPA is Free! Sign up today and you'll receive a username and password that will allow you to access all of the benefits that come with the NLPA membership.


Copyright 2018. This article is the property of the Next Level Purchasing Association and may not be copied or republished in any form without the express written consent of the Next Level Purchasing Association. Click here to request republishing permission.

By Charles Dominick, SPSM, SPSM2, SPSM3

This is the Web-based version of this article. Click here for the printer-friendly version.