There are a variety of reasons why a company may make an acquisition. If a company is growing quickly, one of the most compelling reasons to make an acquisition is it can accelerate growth. Whether it’s talent or innovations, an acquisition in this type of scenario can shorten the amount of time it takes to hit the next milestone.
Although that scenario makes acquisitions sound very appealing, it’s important to understand that they’re by no means a guarantee of success. In fact, the majority of acquisitions fail. That truth spans from the smallest of businesses to huge corporations. So even though acquisitions offer so much potential, why is it rare for them to be truly successful?
The issue of acquisition failures comes down to a few issues. Those issues include incorrectly identifying targets, taking the wrong approach to financing and not properly integrating an acquisition. Since there are some very real challenges that stand in the way of making an acquisition successful, we want to cover the four most important elements entrepreneurs need to evaluate to get the results they actually desire from an acquisition:
The Right Timing
Many people underestimate just how big of a role timing plays in whether or not a startup is successful. Timing is just as important for acquisitions. A business needs to be at the right stage for an acquisition to work. One of the biggest mistakes a company can make is doing an acquisition because they think it will fix their weaknesses. If a business isn’t currently in a position of stability, they shouldn’t be thinking about an acquisition.
One of the reasons entrepreneurs should always think big is there’s a lot of risk involved in bringing a vision to life. As a result, there needs to be a very big upside. This same principle applies directly to acquisitions. Bringing two businesses together will need to create significantly more value (and definitely not less).
Opportunity to Negotiate
It’s important for an acquisition to be a good deal. That’s why there needs to be room for negotiation. Not only is negotiation important on the financial side of things, but if a company that’s being looked at for an acquisition isn’t willing to do any negotiating, chances are they’re going to drag down the entire acquisition process.
A Clear Way to Integrate
Even if the first three elements are in place, it’s still vital to have a clear way to integrate the acquisition. Without a clear vision for integration, an acquisition is almost guaranteed to fall short of expectations.
While there’s still no way to guarantee that an acquisition will be successful, focusing on these four elements is the best way for an entrepreneur to make an acquisition work as expected.
As the role of procurement continues to increase in scope and importance across organizations, more people are looking at exactly what makes great procurement professionals. While there was a time when procurement was an afterthought for many organizations, its increased role means organizations are looking for talented individuals who can deliver the results needed to thrive. Because countless organizations simply don’t know what they should look for in a procurement professional, we want to provide some clarity by highlighting the five traits that matter most:
Anyone who has come into contact with spend analytics knows they can provide clear information on spending activity. While that can be useful, the reason companies should care about these types of analytics is the information they can offer goes beyond just spending. Specifically, it can help a company increase productivity. It can also boost savings by making it possible to streamline existing purchase-to-pay practices.
How exactly can spend analytics help your business increase savings and streamline its practices? The answer is by identifying some specific areas that can be improved, which are:
Contracts are crucial for enterprises. Without them, there wouldn’t be a way to cement the relationships that enterprises have with their suppliers. Given that suppliers are the source of goods and services that enterprises require to remain functional, it’s easy to understand why contracts are something that need to be taken seriously. Although contracts serve a very important function for enterprises, that doesn’t mean they’re always handled properly.
Regardless of the size of a company or its specific industry, the activities of procurement and accounts payable impact each other. Because of this link, a company’s goal should be to maximize the efficiency of both departments. Doing so has very clear benefits, especially in regards to the procure-to-pay process.
One of the best ways to reap all of those benefits is to automate procure-to-pay activities. Purchasing automation offers efficiency and speed improvements that simply aren’t possible through any other means.
Automation directly impacts procurement staff. Once automation is introduced into this environment, it provides procurement professionals with what they need to operate at a higher level of both efficiency and productivity. What’s even more appealing about those gains is they can then help to reduce the staffing costs that go along with processing orders. Instead of spending large amounts of time on basic tasks related to the purchasing process, members of this department can focus their attention on activities that create far more value.
Key Benefits of Procure-to-Pay Automation
Once procure-to-pay processes are automated, a business will notice faster cycle times. The second notable benefit of purchasing automation is increased efficiency for purchase order processing. Because an automated system takes care of routing information in the most efficient way possible, previously wasted time caused by communication inefficiencies is eliminated.
The third benefit that’s very meaningful for businesses is that procurement employees are able to process significantly more purchase orders. That benefit stems from purchasing automation directly assisting with common tasks like purchase order generation.
Another benefit that goes along with automating procurement is a reduction in supplier lead times. The clear and consistent data sharing provided by automation ensures that suppliers have everything they need to avoid delays.
Moving Towards Purchasing Automation
Once businesses learn about all of the benefits that procurement automation has to offer, they generally want to learn more about what it takes to make this transition. When this topic comes up, it’s generally a good time to review the current strategy that’s in place for managing procurement. Looking at the current state of areas like receiving and invoicing provides an opportunity to identify key areas for improvement.
The good news about purchasing automation is not only is it very beneficial, but it’s easier to implement than many companies expect. With the right purchase order software, companies can get all the features they need. From customized work flows to purchase order generation, quality purchasing software puts all the power of automation into a straightforward interface.
A purchase order (PO) plays an integral part in the purchasing process. This document lets a seller know that a buyer is ready to place a formal order. Because this document does serve as a contract between the buyer and seller, it’s important for it to include all relevant information.
It’s critical for the price to be clearly stated on the PO. Since it’s common for buyers and sellers to negotiate price, the PO needs to show the price that was agreed upon. If a purchase order doesn’t include price information, it won’t be helpful later in the event of a dispute.
In terms of areas where buyers can gain leverage for negotiating, quantity is at the top of the list. Simply put, higher quantities make sellers more willing to negotiate on price and other terms. One of the many benefits of purchasing software is it makes it easy to ensure orders are made together in maximum quantity instead of being spread out across multiple smaller orders.
Latest Ship Date
One of the most common mistakes organizations make with purchase orders is failing to negotiate a latest ship date and then putting that date on the PO. Knowing the absolute latest an order will be sent out is the only way to know when it will be available to actually put into inventory.
Terms of Sale
In addition to pricing, a well-done purchase order should cover all other relevant terms of sale. From how payment will be handled to specifying expected quality, using a purchase order to cover these details ahead of time is the best way to avoid a future dispute.
During the rush of trying to put together a purchase order, it’s easy to overlook seemingly small details like marking requirements. However, overlooking this detail can result in products getting stuck in customs. To avoid that type of delay, ensure that all required markings are specified on the purchase order.
Purchasing Software Simplifies Purchase Order Generation
There’s a lot that goes into correctly preparing a purchase order. As a result, the process of preparing one manually can take up a lot of time. For businesses that want to ensure this task is done correctly and maximize efficiency, purchase order software is the ideal option.
With the help of software, purchasing managers and anyone else involved in procurement will have everything they need at their fingertips. Not only do customized work flows make preparing and generating accurate purchase orders a breeze, but this type of software streamlines numerous other tasks like vendor research and vendor negotiations.
In recent years, purchasing departments have begun to play a more significant role within many organizations. A big driver of this shift has been the realization by companies of all sizes that purchasing can actually provide a competitive advantage. As a result of this increased significance, it’s important for companies to understand how to properly measure purchasing performance.
E-procurement can provide numerous operational benefits to hotels that make the transition to this type of system. To help demonstrate exactly why automating inventory and procurement should be a top priority for hotels as 2015 winds down and 2016 gets nearer, we want to highlight the most significant benefits:
Even though it has many common characteristics of a buzzword, the cloud has proven itself to be a lasting shift across the business landscape. As costs continue to come down and options mature in the functionality they provide, businesses continue to shift their operations to cloud platforms.
If your company is exploring different cloud opportunities, we have several important considerations to share with you:
There’s a lot to be said for businesses that are able to maintain agile operations. Even as a business grows, staying agile can provide a significant competitive advantage. One big selling point of the cloud is it supports an agile approach to doing business. Because the cloud makes it possible to keep information shared and updated across an entire organization, it’s possible to avoid the types of communication barriers that can start to slow down a business as it grows in size.
Falling Costs and Increasing Functionality
A big part of why so many businesses choose to move forward with their transition to the cloud is because the numbers make so much sense. As competition continues to increase among cloud vendors, prices continue to be pushed down. The attractive pricing options for cloud technology makes it all that much easier for businesses to transition. What’s really great for businesses that want to use cloud technology is the increasing competition also means vendors are providing as many useful features as possible.
One thing that often gets overlooked in discussions about businesses and the cloud is this transition doesn’t have to be an all or nothing choice. Instead, businesses can take advantage of focused offerings to move the parts of their operations that make sense to the cloud.
Although there are exceptions, this type of targeted transition is generally the best option for the majority of small to medium businesses. The reason this approach works so well is it allows businesses to take advantage of the best cloud technologies that are available without facing any type of large technical hurdles.
A great example of a piece of focused cloud technology that can greatly benefit businesses is purchasing software. Because the purchase order software offered by Bellwether is 100% web-based, it’s easy to access from anywhere. Not only is this software specifically designed to give purchasing managers everything they need to be as efficient as possible, but it makes it possible to customize to specific needs.
From easily automating purchasing processes to enforcing budget thresholds, our cloud software is the top choice of small and mid market purchasing managers. Best of all, the fact that it’s based in the cloud means that it doesn’t require IT support. If you want to see exactly how our cloud solution can help your business save money through increased efficiency, we encourage you to take advantage of our 30 day free trial or let us walk you through a free live demo.
Although the summer is already behind us, there’s still a good amount of time left in 2015. If you want to make most of the remaining months of this year, one thing to focus on is becoming the best purchasing manager possible. Because this is a role that continues to receive more attention and responsibility, you may already be feeling a substantial amount of pressure.
While there are times when pressure becomes too much, it’s something that can also be very motivating. If the amount of pressure you’re experiencing is motivating you to become the best purchasing manager you can be, we have a handful of tips that can help you work towards that goal.
Keep Things in Perspective
Even though it may sound like New Age advice, keeping the various professional obstacles you encounter in perspective can truly help your performance. Staying focused on what matters the most and finding small but meaningful ways to improve will add up to a significant change.
Stay on Top of Changes
Technology means that changes and developments across industries are moving faster than ever before. As a result, purchasing managers can benefit from carving out time each week to keep up with new issues and trends. Consistently doing this will give you a strong, strategic understanding of where your company is moving.
Make Diverse Interactions a Priority
Just as staying on top of what’s changing can be very beneficial, getting different inputs on what people truly want from procurement can help you focus your attention on the right tasks. That’s why it’s worth making a concerted effort to regularly speak with a diverse spectrum of professionals both inside and outside of the company.
Use the Best Tools Possible
If you put the three items we covered above into action, you will see a boost in your performance as a purchasing manager. But if you want to perform at your absolute best, there is one more key step that you need to take. That step is to take advantage of everything that quality purchasing software has to offer.
The reason that purchase order software can revolutionize your performance as a purchasing manager is it provides all the functionality that’s needed to supercharge procurement. Specifically, you’ll be able to easily automate any purchasing process that you want. This in turn will help eliminate the need for paper.
Instead of feeling basically helpless in regards to budget thresholds, using software means that you will have the ability to enforce approvals and put an end to maverick spending. All of this streamlining and enforcement will save you a ton of time every single week.
What’s even better is you can reap all the benefits of this type of software without needing IT support. And to top things off, you’ll be able to leverage vendor pricing through the use of historical data. The ability of our software to help purchasing managers be the best at what they do is why over 1,000 professionals like you have given it a top usability rating.