7 Strategies to Reduce Acquisition Cost in B2B Purchases

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As B2B purchasing are responsible for a large part of a business's costs. The most prominent companies in the current scenario know that saving on purchases helps not only to ensure an increase in profit margins, but also in competitiveness, since the company starts to offer more attractive prices on the market.

However, researching suppliers is not enough to reduce acquisition costs. To optimize your future purchasing processes and reduce these costs in future transactions, see below 7 strategies that can make a difference.

1. Strengthen the relationship with the supplier

The closer your relationship with the supplier, the better the payment and service terms you will be able to negotiate. While it is unlikely that a company will offer special terms to a customer who makes a one-time purchase, it will certainly do so in the case of large, recurring purchases.

Therefore, seek to strengthen the relationship with your suppliers based on collaboration. In this case, it is worth putting together a portfolio of fixed suppliers, which generates recurring revenue for those involved.

Change all the time suppliers prevents the construction of stronger ties. Not to mention that, in this way, your company will never leave the status of a new customer and, therefore, will have less chance of getting discounts or negotiation facilities.

A consistent relationship with the supplier is one of the keys to making your arguments stronger and more persuasive when asking for easier conditions.

2. Analyze the market situation

Another important point is to consider the market. It is worth knowing, for example, how much your competitors are paying on average for their purchases. You can also get a quote for equivalent products to understand if your company is spending too much.

This type of check-up is important to have a more complete understanding of the purchasing conditions. This will make it easier to understand what you can cut to reduce expenses.

As a bonus, checking the current scenario ensures that you notice if there are any new trends in raw materials or payment models, which can be used in your own logistics.

3. Negotiate acquisition costs

Negotiating prices and supply conditions is an excellent tactic for reducing costs.

One option is to get quotes from suppliers of similar quality. When you find cheaper options, use these quotes as an argument for negotiation.

If the supplier company is willing to maintain the contract with your business, it will probably offer more affordable prices and even match other offers.

You can also ask for a discount if you are making a large purchase or intend to maintain a long-term contract. Thanks to the large volume of transactions, negotiating special conditions is easier.

Imagine that a company orders an average of 2 units of a certain product per month. Now, in just one month, your company intends to purchase 4. This means that your business alone will be responsible for 2 months of the supplier's revenue for this item.

Therefore, it is possible to negotiate conditions that facilitate this purchase and, therefore, reduce costs. Instead of paying the full amount for the 4 thousand, the company can offer an amount corresponding to 3,5 thousand, and both the company and its business will come out on top.

It is also important that these negotiations are carried out from time to time — and not just for the first purchase. Since adjustments and possible changes can make contracts less attractive, renegotiating the terms prevents the business from increasing its expenses.

4. Get different payment terms

Another way to reduce acquisition costs in B2B purchases is to change payment terms. When it is necessary to pay for purchases with a very tight limit, the company has to have a larger amount of resources available. This hinders financial planning, even more so if the business makes sales on credit.

The best way to deal with this possibility is to ensure different payment terms. If you can pay over a longer period of time — especially after receiving payment from most of your customers — you will lose fewer opportunities and reduce financial difficulties.

5. Propose joint actions

Acting together can be beneficial for both the buyer and the seller. It is possible join forces in search of results such as increased sales or even the acquisition of new customers. This is the time to transparently demonstrate the benefits of this type of agreement for everyone.

It is also time to request a discount on the purchase. In this sense, the supplier wins because they sell more and have a higher average ticket. The company that is in the role of buyer, on the other hand, wins because it can adjust its prices and be more attractive.

Speaking of joining forces, another good option is to team up with other companies to make larger joint purchases. The larger the order, the greater the chances of getting discounts and other special conditions.

6. Avoid urgent purchases

Have you ever had to buy a plane ticket at the last minute? If so, you know how expensive rushing can be. The more urgent an order is, the higher its cost will be. The unpredictability of the situation means that the supplier will charge more because they know it is a necessity.

Even if the supplier wanted to keep the same price, the lack of planning makes it more difficult to obtain the items and guarantee deadlines. Therefore, avoid urgent purchases. Try to place orders as far in advance as possible, since this way it is possible to obtain different conditions.

Use data from other sectors, such as inventory and sales information, to forecast demand. After that, place your orders as far in advance as possible to ensure optimal business conditions.

This tip is especially important for those who buy items whose prices fluctuate a lot. With planning, you are the one who dictates the conditions.

7. Rely on technology

For large companies, carrying out these processes manually is unfeasible, or, to put it mildly, counterproductive. There are many departments and purchase orders to manage, and monitoring the progress of each of them in this way can be a difficult task.

To resolve this issue, the tech is a great ally. With a automated, everything is under control. Now, the operations of registering all your suppliers and monitoring the performance of operations are increasingly simplified.

Nowadays, large companies no longer waste time finding out whether the supplier is meeting the requirements and whether the relationship with them should continue. The use of technology combined with artificial intelligence not only does it facilitate the process, it also makes the information presented more reliable and favors decision-making.

By following these strategies, you can reduce acquisition costs in B2B relationships. In other words, to get discounts and better conditions, you just need to plan and rely on technology. And how do you reduce acquisition costs in B2B purchases?

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