Group 01 – Ankit Sinha

Arun PalaniappanChaitali KarnikShuyaasha Misra

Objective

A research on prospective suppliers:

1. Their current distribution strategies – online vs traditional.

2. Functionalities and benefits enabling adoption.

3. Parameters think can leverage to develop marketing strategies /infographics.

Research ProblemTo conduct a market research on what suppliers need,

and how think can use these insights to make them early

adopters.

Background Information

think is an organisation which

provides e-procurement, SaaS based

solutions that:

- Re-engineer

- Innovate and

- Enhance

procurement initiatives for its clients.

It offers services such as data

cleansing, 3-way matching system, as

well as a comprehensive travel

management system.

Research Question

Our research centered around the question :

“Do you have an online selling portal of your own or a third party website? And if not, would you be interested in coming on board on one?”

Literature Review

- Four cycles for e-procurement market : Advantage, Choice, Cost, Replacement.

- Key Drivers for successful solutions : Speed of implementation, Quick ROI, High User Adoption, Ease of use.

- The concept of SUM: Spend under management, which leads to supervised spending and controlled costs. It allows the company to have a select few suppliers and spend volumes only with these suppliers leading to gains via volume discounts.

Literature Review

Reduction in processing costs by electronic invoicing

25% Think reducing

receivables processing costs is most important

45%

Average debtor days

7.3 days

Of organizations indicated cutting costs as #1 priority

53%

Research Concept

Questions asked :

• Rate the effectiveness of their existing

distribution channels.

• Select the factors that they wish to improve

in their current online distribution strategy.

Information regarding invoicing and debtor

days.

• Factors determining success of an online

distribution strategy.

Theory Propositions

Develop measures & sample

Collect Data

Analyze Data

Implications

The logic of research process:

Research Design

- Convenience sampling technique.- Sample size of 450.- No. of respondents – 32. - Conversion rate – 7%.

- Small to medium range of organizations.- Supplier annual turnover less than 20 mn.- Indian and Australian suppliers targeted.

- Industries – IT, Healthcare, Hospitality, Retail, Manufacturing, Real Estate. - Survey floated by means of phone, email, as well as social platforms like LinkedIn, SME organizations (SMEA, ASSA, SBA).

Data Analysis

No online portal

72% Looking

for an online portal

70%

Stock turn-over

Increase profit

Sales conversion percentage

Reduce accounts receivables

Increase in number of customers

0% 5% 10% 15% 20% 25% 30%

Importance of factors for Online Distribution

Minimal Invest-ment

Analytics User Interface Ease in reconciling

invoices

0%

5%

10%

15%

20%

25%

30%

35%

40%

Functionalities affecting choice of Online Distribution

Data Analysis

We used Discriminant analysis to predict the suppliers’ interest in signing up for an online distribution channel.

Y variable: Data for signing

up(Yes/No)

Company turnover

Average debtor’s

days

Target Market

Availability of Portal

No. of invoices raised

• The result showed that the demographic factors were out of significance range and the psychographics factors were highly significant.

• Hence we can model an equation based on them to predict correctly with a 78.1 % confidence.

Test of function

Wilk’s Lambda

Chi-Square df Sig

1 .331 20.998 6 0.002

Duplication

Descriptor differences between customer purchase order and our invoice

Difficulty in follow ups

Customer Losing Invoices

Debt Collection

0 2 4 6 8 10 12 14

Online Portal vs Problems faced

Yes No Online portal

<14 15-30 31-60 61-90 91-1200%

10%

20%

30%

40%

50%

60%

70%

Online Portal Availability vs Debtors Days

No Online portal Online Portal in place

Data Analysis

Problems faced for suppliers with an online portal vs suppliers with no online portal.• Debt collection #1 for both• Customer losing invoices #2 for

suppliers with no online portal• Duplication #2 for suppliers with

online portal

Chi-square test run between online portal availability & debtors days.Findings:• Significantly different • Up to 75% reduction possible in debtors

days by having an online portal

Healthcare Hospitality IT Manu & Construction

Retail0

1

2

3

4

5

6

7

Industry wise factors important to business

No of distribution channels Revenue

Customer loyalty

Revenue Profits No of clicks0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Effectiveness of current online portal

Own website Third Party

Data Analysis

On analyzing the type of online portal against an effectiveness rating of 1-5, Revenue was rated lowest by respondents with a third party online portal

On analyzing supplier’s industry type against factors that are important to their business (on a scale of 1-7), IT rated no of distribution channels lowest & Hospitality rated customer loyalty to be the highest

Porter’s 5

forces

Threat of new

entrants

Threat of substitute

s

Bargaining power

of buyers

Bargaining power

of suppliers

Degree of rivalry

Business Analysis

TenderSearch, RS etc.

Own/Third party websites

Lesser power – new market

Small suppliers

Nascent market

Recommendations

• Think Procurement should assume the role of industry leaders and adopt an aggressive content strategy.

• Materials on industry best practices, resolving issues of procurement managers etc should be used as marketing material and distributed via social media channels such as Twitter, Facebook, LinkedIn

• Use improvement in debtor’s day and number of invoices per month as the crux of their marketing strategies.

• Think has a very user friendly interface and it should leverage as its USP in the market.

• Highlight advantages of the 3 way matching process.

Thank You