Queens of Procurement

By Dr. Kath Ringwald Director of the Procurement Best Practice Academy.

For over 100 years we have been celebrating International Women’s Day in one shape or form. During that time, women’s lives have changed completely. Universal Suffrage was just one landmark on the road to women gaining equal access to education and career opportunities, serving in the front line with the armed forces, making informed choices about childbearing and playing a full part in all aspects of society. However, the reality for many women around the world is far from equality of opportunity and many still struggle to gain respect and recognition. Women graduates in the UK still earn less than their male counterparts who graduate with similar degrees and are in similar jobs. The average wage for women in the UK is still less than that for men, though the gap is narrowing. Around the world women are still fighting for control of their own bodies, the right to an education and the right to make choices for themselves and for their children. In terms of equality, there is still much to be done.

In our own profession there is good and bad news to report regarding equality. A recent survey by CIPS  shows that since 2005 Procurement professionals have been paid well above the national average for ‘all professions’, but though male and female purchasing professionals enjoy relatively equal salaries at assistant manager to middle manager levels, the picture changes drastically at senior manager and Head of Function level. Only 33% of senior managers in the survey are women and their earnings are 5% less than men. Disappointingly, only 22% of Heads of Function are women, earning on average 15.6% less than their male counterparts.

Thirty years ago we might have attributed these statistics to the traditional view that mothers should take a career break to look after their children, or a lack of adequate child care arrangements, or limited opportunities for advancement in male-dominated industries, but we now live in a very different world. Procurement and supply chain management opportunities are now widely available to women and we are seeing more and more examples of women holding senior positions in the profession. Sue Moffat heads the newly launched National Procurement Service in Wales, Nikki Bell is Head of Scottish Procurement Policy and Strategy, Sarah Ellis was Director of Procurement at BAA and is now Director of Procurement Presence. Shirley Cooper and Dr Jane Gibb have both been presidents of the CIPS and here in Wales the academic community can claim to have a fair representation of females with myself and Dr Rachel Mason Jones here at University of South Wales and Professor Christine Harland, Professor Helen Walker and Jane Lynch at Cardiff University.

Despite these advances, we are more than familiar with the jibes – however well intentioned – about ‘women and shopping’ and there is still a sense that the top jobs are occupied by men.  As academics and practitioners we need to stand up and be counted – and our numbers are increasing. There may not be a ‘glass ceiling’ but we still need to fight for a seat in the boardroom with 100% of the rewards the role deserves.

So, I call upon all of the women in the profession to inspire the next generation of Queens of Procurement, to continue the fight for equality and to continue to show that this is one profession where women can equal and often out-perform the men.

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Reflection on Retail Performance:Multichannel the big story of the Christmas season

By: Vera Ndecaj BA(Hons), MBA, ISBE and PhD student

Retail sales growth is being driven by the click of a mouse, rather than the ring of the tills (McCorquodale, 2013).

According to the British Retail Consortium (BRC) UK retail sales were up 0.4% on a like-for-like basis that represents a good overall result in 2013, when they had increased 0.3% on the preceding year. On a total basis, sales were up 1.8%, against a 1.5% increase in December 2012, the lowest growth of 2013. Online sales on health/  beauty, clothing and fashion in the UK grew 19.2% in December 2013 versus December 2012, the highest growth in four years. The online penetration rate achieved 18.6% in December 2013 (BRC 2014). This happened not as a result of economic growth, despite the higher customer confidence level than previous year but as a result of successful marketing strategies that enable retailers to boost sales.  Online sales in December representing almost one in five items sold, proving that retail sales growth is being driven by the click of a mouse, rather than the ring of the tills.

     Multichannel retailing: traditionally retailers used a single channel of customer interaction a physical store expanding to multiple channels including e-mails, phone calls and catalogues. Technology development has lead to innovative way of interpersonal interaction,  in internet and social media,  embedded in our social culture that subsequently open new channels for offering products and services. This is driven by internal and external factors but most important factors are; strategic competitive advantage, differentiation, customer demand, cost reduction, and regulatory pressures.

    Retailing consists all activities involved in the selling process of goods and services to consumers for their personal, family or household use. It is the final stage in a channel of distribution that adds sufficient value that customers are willing to pay a premium for their product or service and this assures profitability.

 Factors that influence the industry.

Large multiples and independent retailers have become more vibrant and customer focus, analyzing industry trends and consumer behaviour during the decision making process has proven to be essential for the industry. The retailing industry paradigm is changing as the global and regional economies are transforming worldwide. It is also in threshold of a big revolution after the social media, internet and technology development.  Physical store improvement and availability of quality retail space, wider brand choices and better marketing communication are some of the factors driving UK retail despite budgets still under pressure. Other factors that influence the retail industry are:

  1. Demographic changes: UK population increase, number of householders increase, householders size decrease, age of population increased, young shoppers facing higher university fees, higher housing costs, but they are more computer literate and spend more on-line.
  2. Changing trends and customers behaviour
  3. Income and expenditure: Retail expenditure is growing faster than income, high level of consumers’ debt, low saving ration, a week housing market, with long working hours plus internet and technology have lead to the huge expenditure concentration in non-store shopping.
  4. Government legislation

These changes required an effective competitive advantage strategy and innovative approach to satisfy customers’ needs and expectations. However, due to increased affluence and mobility, and the rise of internet shoppers who not only shop to satisfy needs, they increasingly shop to satisfy wants as well.  As the retail paradigm change retailing in high street is becoming a queasy leisure experience, which poses a threat to small centres.  Quality restaurants, coffee shops, cafes and bars, as well as health and fitness centres and multiplexes in larger centres, are therefore important to attract shoppers and encourage longer stays and higher spending. Better integration of retail and leisure facilities mutually benefits both sectors.

SIRs have been burdened by the costs associated with new legislation and regulation. They cannot compete with the scale economies achieved by the chain-stores and multi nationals nor can they access comparable global supply chains.  This has pushed them to close stores and invest in their websites and improve delivery time. Although, in order to increase their profit they are using on-line channel that enable them to enter global market and also find innovative approach such click and collect and other approaches  to make a virtue of both their websites and their physical shops.

The Head of Retail at KPMG, David McCorquodale (2013) stated  “December 2013 was all about nerve, retailers who held their nerve and provided a seamless service between channels will feel pleased, whilst those who discounted heavily to force sales will count the cost in margin”.  Multichannel is the big story of the season. This Christmas experience will lead retailers to invest more in multichannel capabilities as a prospect of the future.

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Reflection and New Beginnings

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By: Dr Kath Ringwald, Director, The Procurement Best Practice Academy- CSCOPE http://cscope.southwales.ac.uk/kath-ringwald/

As Christmas approaches and the end of 2013 is in sight, it is traditional to look back over the year and reflect on the highs and lows that have occurred.

For procurement professionals this year started with a bang – the horsemeat scandal which broke in January put supply chains and global sourcing on the front page of every newspaper and website. Suddenly everyone was interested in supply chains – particularly those that started in remote abbatoires in Eastern Europe and ended up in the freezers of British households, including the Queen’s own kitchens. Now, 11 months on, there have been no prosecutions or fines and we still do not know how the horsemeat found its way into our weekly shop. Enquiries and police investigations continue, but as one MP said this week ‘We are no further forward that we were 10 months ago’. Oh dear! It appears that transparency and trusted supply chains still elude the food industry.

Throughout the year we have had reports of impending doom because everything from oil and water to the precious metals needed to make our essential gadgets and gizmos are in short supply and only a technical revolution can save us from rocketing prices and rationing.

As the year ends we are receiving news that some companies are reversing outsourcing policies and bringing manufacturing back to the UK, particularly at the high end of the market spectrum like Gaziano & Girling who make shoes costing up to £6500 a pair. Others like Jaguar and the Weir Group are investing in plants in Brazil and Malaysia to take advantage of low cost supply chains and developing markets.

The public sector across the UK continues to face savage budget cuts and looks to the Procurement specialists to deliver cost reductions that will release much needed money to front line services. In November the Welsh Government launched its National Procurement Service which will ‘buy once for Wales’ on behalf of over 70 public sector organisations to deliver an estimated £25 million in savings. This flagship development is attracting some of the brightest and the best procurement talent in the principality and will be ‘one to watch’ in 2014.

In these dynamic and challenging times, The Procurement Best Practice Academy http://cscope.southwales.ac.uk/procurement-academy/ has been established to identify, disseminate and celebrate the very best  in Procurement and Supply Chain Management practice. Launched on the 11th November by Jane Hutt AM and Dr Jane Ellis, the Academy’s membership is growing nationally and internationally. If you are not already a member, please visit http://cscope.southwales.ac.uk/procurement-academy/membership/ fill in a Membership Application to become part of a community of practice that can make a real difference.

The PBPA team would like to thank you all for your support and wish you a very merry Christmas and a peaceful and prosperous New Year.

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