The five sectors that consistently achieve the poorest value when buying ICT products are Housing Associations, Retail, NHS, Pharmaceutical and Universities, according to a study by Mercato ITelligence, the only ICT product price benchmarking tool approved for the government’s G-Cloud.

The average margin paid by these sectors is considerably higher than the industry best practice rate of 3%¡ – Housing Associations (36%), Retail (35%), NHS (28%), Pharmaceutical (28%) and Universities (27%).

With Western European economies stuck with slow growth for the foreseeable future organisations are looking to increase their use of technology in order to provide efficiencies.

However, with £493bn¡¡ predicted to be spent on ICT in Western Europe this year, it is clear many millions are being wasted by purchasing products at excessive prices.

Mercato’s Head of Benchmarking, Al Nagar, said: “Organisations are overspending on their IT as a result of the radically fast moving market and this is hitting bottom lines at a time when many are fighting to become more efficient. 

“Buyers need to monitor and benchmark prices to negotiate the best price with suppliers as ICT bought at better prices will enable budgets to be stretched.

“Organisations could gain more and better ICT for the same money.  This means higher volume for the supplier and better fairer deals for the buyer.”

Benchmarking organisation Mercato reveals organisations have been paying margins up to 731%.

Mercato research shows that 81% of organisations do not secure best value when they make investments in ICT.  Volatility in the market makes it difficult for buyers to gather data and find the optimum price. 

Mercato ITelligence is helping IT buyers achieve this by allowing them to quickly undertake validated benchmarking activity online, comparing quotes secured before purchase with current trade guide prices and stock levels in the UK IT supply chain.  It shows firms when margins are extortionate, so they can negotiate a better deal.

Nagar continues: “It is clear from our research that IT buyers are finding it difficult to obtain and manage comparative data on ICT product costs, particularly in such a highly volatile market where price and stock change daily. 

“Without this comparative data to compare quotes against, buyers are struggling to achieve best practice best value of 3% margin.  This is significantly hampering efforts to stretch the reach of every pound, which could be impacting efficiency and growth as organisations cannot get the level or volume of technology they demand.”

Mercato ITelligence has been proven to save organisations up to 24% on their IT spend. It is the only benchmarking tool approved for the government G-Cloud and is used by 30% of UK Police Forces, a number of Local Government organisations and an extensive amount of private sector businesses.

Mercato technology is accredited by CIPS for offering Procurement Excellence and the Institute of Chartered Accountants for its financial credibility, providing ‘Best Practice Best Value’. 

And a search for benchmarking on the CloudStore finds just one tool, Mercato ITelligence, which directly tackles this subject. It provides daily updated market guide price and stock levels on over 150,000 ICT products from more than 2,500 manufacturers.

Benchmarking is broadly recognised as a best practice procurement methodology that helps drive Best Value and consistently transparent pricing. A point raised by Sir Phillip Green’s Efficiency Review, which found wide price variance on products across the public sector and ‘very poor’ quality of data, both of which hamper cost management.

Research by Mercato ITelligence across 1,000 public and private sector organisations found that 81% are not securing the IT margin they expected and some were paying up to 474% margin for certain items. The research concluded that the scale and volatility of the IT supply chain made it difficult for buyers to conduct validated price benchmarking.

A recent SOCITM Annual IT Trend survey confirmed a 3% margin paid for ICT products is a benchmark of good practice.

The G-Cloud framework, therefore, clearly sets out to drive best practice margins by empowering the procurement ‘front line’ to negotiate better ICT product deals, police the performance of supplier pricing and drive continuous value for money.

Chris Haynes, former Cabinet Office eDelivery Team Director, said: “Benchmarking is an essential first step towards more joined-up professional procurement and radically driving down costs. Traditionally it has been difficult to obtain and manage comparative data on ICT product costs, particularly in such a highly volatile market where price and stock change daily.

“It is widely accepted that 3% margin is good practice but without a validated trade price to use as a benchmark, buyers have had little in the way of insight on which to conduct ‘intelligent purchasing’ – qualifying transparency of relationships and whether best value is being reached or not.

“The fact that only one ‘tool’ has made it on to the framework is testament to the challenges of bringing together highly disparate and dynamic market data into a useable browser based tool. Government Procurement Service should be highly commended for delivering such a solution to the public sector community via G-Cloud.

“It will help the public sector overcome paying higher than average prices for ICT products at a time when best practice CIPS approaches are readily influencing how government professionalises it’s procurement.”

Mercato ITelligence has proven to save organisations up to 24% of their IT spend, helping ICT buyers stretch the reach of their existing budgets. Mercato technology is accredited by CIPS for offering Procurement Excellence and the Institute of Chartered Accountants for its financial credibility. Mercato ITelligence is used by 30% of UK Police Forces, a number of Local Government organisations and an extensive amount of private sector businesses.

The business estimates that 70% of private and public sector IT buying for consumables, desktops and printers is conducted on a day to day demand or reactive basis.  This is in the context of a highly volatile IT supply chain where price and stock change daily.  When there is a requirement, the ICT buyer – who often multitasks as an IT manager or procurement champion – contacts suppliers, potentially benchmarks prices and makes a purchase. 

However, the Japan Tsunami and Thailand floods have significantly impacted component and finished product delivery, shortages and ultimately price hikes.  Hard Disk Drive shortages from the Thai floods are still being reported as impacting supply of lower end cheaper laptops, desktops and servers. 

Nagar explains: "Buyers demanding such items reactively are having to settle for more expensive, higher end products where stock is available.  So, natural disasters’ impact has brought into sharp focus the acute underperformance of a reactive ad-hoc approach to buying.

"A lack of forward planning is impacting IT procurement budgets, yet this could be overcome as regular buy or larger one-off purchases can be forecast to a large degree.

"Now is the time for buyers to kick-start a longer term best practice strategy and forward plan buying to genuinely buy more for less whilst maintaining fulfilment of demand and therefore business continuity.  The reactive view is costly and it must change.

Nagar offers some direction: "Buyers need to analyse average purchase volumes on key routine items and put in place monitoring facilities or alerts that enable them to watch stock and price levels. 

"When stock or price move towards critical levels, the purchaser knows to act proactively and at the best price.  In this way, purchasers can reduce risk and minimise costs and threat to business continuity."      

Market research conducted using Mercato ITelligence, an IT price and stock benchmarking tool, has previously found that of 1,000 respondents 81% were not getting the IT deals they expected with margins as high as 474% unearthed.

"Price and stock in the supply chain change readily and natural disasters accentuate the challenge for time strapped multi-tasking ICT buyers trying to achieve best value on every purchase. 

"Better planned and researched proactive buying is proven to yield greater compliance and more-for-less budget compared to ad-hoc, reactive and fragmented buying behaviour.  Simple support structures exist to facilitate a proactive culture," concludes Nagar. 

The College’s procurement team has been able to drive down the cost of purchase process and products as a direct result of accessing real-time information that is enabling the team to quickly negotiate better value deals and benchmark existing agreements, and is now reinvesting those savings directly back into providing an even better experience for learners.

The new approach has been adopted after BMet’s procurement team identified that the highly volatile IT market, where prices daily rise and fall, needed to be addressed with a less fragmented buying approach.

The best practice structure that Mercato ITelligence provides is forecast long term to save BMet up to 24% on prices paid and around an hour per order on administrative time, otherwise spent trying to manually benchmark multiple suppliers.

Now, buyers simply input their preferred supplier product lists or spot checks online for a real-time comparison with trade guide price and stock on over 150,000 products from more than 2,500 manufacturers in the UK IT supply chain.  The tool’s automated ‘alerts’ also indicate when price or stock rise or fall for long term sustained best value.

BMet’s Jamie Smith, Director – Systems & Policy Development, said: "Through ITelligence we are able to conduct qualified benchmarking activity quickly and simply.  Mercato ITelligence has enabled Birmingham Metropolitan College to provide financial assurance that we are achieving value for money on consumable IT related spend".

"The tool’s management reporting and forecasting capability is also giving us critical market intelligence and allows us to watch key market trends.  By establishing patterns in the market we are able to plan our buying activity, which helps the organisation stay ahead and save money.

"We now deliver more informed, cost effective and efficient procurement with a best practice approach to buying in what is a very tough market.  Return on investment has been quick."

With management reports and forecasting facilities, Mercato technology offers Chartered Institute of Purchase & Supply (CIPS) accredited ‘procurement excellence’ and cashable savings.  It has also been approved as offering Best Practice Best Value by the Institute of Chartered Accountants.

Pro-active buyers and budget controllers are regularly challenged by price and stock changes. Research by Mercato ITelligence, the IT buyers benchmarking tool, has found that as a result *81% of organisations could achieve better deals.

Mercato ITelligence surveyed and analysed purchases made by 1,000 IT buyers working in private and public sector organisations.

Mercato Head of Benchmarking, Al Nagar, said: "The results of the survey are quite startling, particularly when you consider the budget wastage applied nationally. It confirms that IT buyers are challenged by the volatility of the global IT supply chain, which is driving lots of price and stock movements. Without appropriate tools, buyers will continue to struggle with managing supplier data to undertake valid benchmarking activity."

"The global economy has elevated IT prices considerably and Mercato ITelligence is giving users the knowledge to stay one step ahead of suppliers to ensure they minimise the impact of price rises on budgets."

"Its functionality gives the ability to track market trends and understand how external or economic factors are effecting price. This knowledge means users can predict the direction pricing is expected to go and this helps plan for bulk buying on big projects at the optimum time for best value."

Mercato ITelligence helps buyers combat the challenges of a dynamic IT supply chain by providing trade guide prices and critical market information. This empowers better buying decisions and negotiation from a position of strength, quickly. It also enables the policing of cost plus agreements and is saving 3% – 24% on IT budgets.

Users simply enter individual products or lists and the secure web-based system automatically conducts an impartial price and stock comparison with over 150,000 daily refreshed products in the UK’s IT supply chain. It ultimately tells users the margin their preferred supplier is proposing and introduces true transparency into managing an efficient supplier relationship. The supplier benefits from a faster deal process and longer term relationships.

Buyers benefit further through manipulating and interrogating lists by preferred supplier, project budget or even financial quarter and can automatically generate RFQ’s. For financial controllers, management functionality improves spend visibility and forecasting power.

Major users include National Express, Co-op, Transport for London, McLaren, John Lewis, Sage and University of Nottingham.

Nagar continues: "Mercato ITelligence is saving organisations over an hour per product price request on average and up to 24% on IT budgets as deals are consistently sharper. In the current testing economy this procurement and budget control tool is more relevant than ever before, delivering both cashable and non-cashable benefits."

"Knowing total stock availability within the channel tells users exactly when to buy. If it is in-stock then great but on a deeper level, if they know there is an overstock scenario, then it’s a great time to negotiate an even better deal".

"Mercato ITelligence is facilitating cost reduction through its efficient RFQ and price discovery process. This is switching on procurement, commercial and financial departments to this knowledge-is-power solution."

Mercato is accredited as offering a Best Practice Best Value approach by the Institute of Chartered Accountants for England and Wales (ICAEW) and recently achieved a global procurement accreditation from the Chartered Institute of Purchase & Supply (CIPS).

Head of the CIPS Procurement Excellence Programme, Mike Mari, said: "As a former procurement practitioner I can see the value add that Mercato can offer in taking forward the role of procurement professionals operating in a transparent environment. Automated technology is playing an enhanced role in enabling the delivery of more collaborative and streamlined procurement approaches."

"This accreditation recognises Mercato as offering good practice in procurement policies, procedures, and ways of working."

Mercato ITelligence will be showcased at eWorld Purchase & Supply, 6th March 2012.

*In a survey of 1,000 organisations.

Mercato Solutions has designed, delivered and manages the software technology delivering this procurement tool.

Probrand hosted a presentation to vendor partners in the morning at the Botanical Gardens, Birmingham, and Mercato’s Peter Fellows, delivered an authoritative presentation on products for Data and Knowledge Management.

His Royal Highness, The Duke of Kent then presented the Queen’s Award before heading to Probrand’s Camden Street headquarters for a tour of the business. His Royal Highness also visited partner business Mercato Solutions where he showed great interest in a series of product demonstrations.

www.theITindex.co.uk has been recognised for saving organisations £Ms on product prices and buying process by eliminating the timely task of calling numerous suppliers for best price and stock.

The award is the first to recognise the growing global information economy and technology manufacturing community in the Midlands. With his interest in data and technology, The Duke of Kent decided to personally present the award to Probrand as it enters its Platinum 20th year of business.

www.theITindex.co.uk is believed to be Europe’s largest automated online IT procurement site.

It daily updates and compares over 150,000 products and services from more than 2,500 manufacturers and ranks them by best price and stock availability.

The Queen’s Award recognises Probrand has achieved the highest level of excellence in improving its performance and commercial success through continuous innovation over the last 5 years.

David Noble from The Chartered Institute of Purchasing & Supply commented: “Probrand has been recognised by CIPS for its procurement excellence in purchasing policies and procedures through CIPS Certification and it is particularly rewarding to see the first procurement process of its type uniquely recognised with a Queen’s Award for innovation.”

Chris Haynes, Senior civil servant HM Government, said: “The effective management and design of procurement practice are fundamental building blocks for cost effective government. The capabilities and competencies of Probrand’s data, design, architecture, analysis and innovative ways of building marketplaces, makes the Queen’s award fully justified.”

A recent innovation has automated complex e-auctions as an additional step in reducing ICT purchase price and process. It daily gathers product demand from the market before pushing that opportunity back out to suppliers at 2pm every day. Suppliers then have the afternoon to bid price down to win that business.

Peter Robbins, Probrand Managing Director, said: “We are focussed on giving IT buyers the most efficient ways of getting competitive deals on ICT from across a hugely fragmented, multi-level supply chain. We bring a competitive market into one environment where people can buy direct.

“This is the innovation that has interested His Royal Highness personally. It is a huge honour for us to be recognised as a leader amidst the growing and recruiting Midlands technology corridor.

“Continuous innovation and investment in the Mercato technology behind www.theITindex.co.uk is driving the business and supporting our supply chain partners. It is deployed globally for IBM as www.PreSalesAdvisor.net across 37 countries in 22 languages.”

www.theITindex.co.uk is recognised by the Chartered Institute of Purchase & Supply (CIPS) for offering procurement excellence and getting people to the best priced products in the shortest possible time. Its financial benefits are acknowledged by the Institute of Chartered Accountants.

To see more of the event’s pictures visit www.probrand.co.uk

Peter Robbins, Probrand and Mercato MD, receives the Queen’s Award for Innovation from HRH The Duke of Kent

HRH The Duke of Kent shows interest in PreSalesAdvisor.net demonstrated by Mercato’s Principal Software Architect, Neil Tonkin

However, an often forgotten fact is that as technology ages, so its price quickly comes down in a bid to buoy sales as newer technology is introduced. Does this mean that we’re all getting a fair deal from cost plus agreements?

The cost plus agreement usually sees a medium to long term transparent arrangement between supplier and buyer, usually between 3 – 5% above the cost price.

However, as the dynamic nature of the technology sector means that IT hardware and software costs fluctuate hugely, the cost plus agreement could become anything but transparent.

With IT price and availability changing on a daily basis it is increasingly difficult for buyers to keep a real-time grasp on exactly what they’re purchasing and whether they are getting value time after time.

To that end aggregation technology exists in the marketplace that empowers buyers with the knowledge to police their preferred suppliers to ensure they are getting the deal they agreed.

It is this type of technology that can provide efficiency gains on many levels, from better product in-cost to time savings associated with finding the best priced product on any day, to enable departments to stretch the reach of their IT budgets.

Organisations are successfully using technology that requires no user training, no supplier education and operates on a low investment Software-as-a-Service (SaaS) model – hosted/managed off site.

This type of market intelligence technology offers product lifecycle functionality like stock and price tracking. The bottom line is that buyers no longer need to purchase at the highest price. It also gives them granular levels of product and market knowledge to rationalise whether they need to pay a premium for the newest and highest specification products. An example of this technology is Mercato ITelligence, which is one Tool within a fully integrated solution.

Uniquely, Mercato allows users to input their own suppliers’ product prices before the solution automatically conducts a price and stock comparison with over 150,000 products across the UK’s ICT supply chain. Buyers can now negotiate with suppliers from a position of strength.

Essentially, there is no need to be left in the dark when it comes to securing value as part of a best practice approach to procuring IT. Tools exist in the marketplace that will add value to a buyers role by empowering them with market intelligence for improved negotiating and policing of purchasing agreements.

Birmingham based enterprise applications provider, Mercato Solutions, has entered the UK’s hall of manufacturing fame thanks to a ‘Made By Britain’ nomination from Birmingham MP Shabana Mahmood.

And the business has been selected by the MP for its global export and continuous innovation, which reflects a growth in UK based technology manufacturing.

Launched by Vince Cable MP as ‘650 MPs, 650 makers, 650 stories of British ingenuity’, ‘Made By Britain’ celebrates the very best of British manufacturing and design ingenuity.

Shabana Mahmood, MP for Birmingham, Ladywood, said: “Mercato is a growth business that delivers a unique combination of large scale data management and simple online software tools that help organisations save and make money by transforming the roles of buying, selling and service delivery.

“This award-winning business employs a locally upskilled workforce to turn data into gold for the most scrutinising global organisations right from the heart of Birmingham’s oldest industrial heartland, the jewellery quarter. It epitomises the new-wave industrial revolution sweeping across the midlands.”

Mercato Solutions’ approach is helping global customers take bespoke products to market 1000%+ quicker, drive sales across 37 countries in 22 languages, cut cost from procurement processes as well as facilitate four year growth highs of 380% for an IT reseller that has won a Queen’s Award for Innovation as a result.

Mahmood continues: “Mercato has earned its place on the ‘Made By Britain’ map for leading the Midlands’ switch to technology manufacturing with cutting edge innovation that is unlocking domestic and export markets.

“This is a reflection of the business’s commitment to invest in and train local people, re-igniting the Jewellery Quarter’s historical landmark position in UK manufacturing.”

Mercato is uniquely accredited for delivering Procurement Excellence by the world renowned Chartered Institute of Purchase & Supply as well as Best Practice Best Value by the Institute of Chartered Accountants, recognising its capability to deliver on the bottom line.

Mercato joins a current list of 194 British manufacturers that appear on the ‘Made By Britain’ hall of fame.

When done in the shortest possible time through an efficient market, sellers can actually respond ahead of the market to shortsell stock.

It is the ‘efficient market’ at the core of the price discovery process that enables buyers and sellers to unearth price and act with haste. This is the focus of this paper and how IT buyers are using aggregation technology to keep ahead of the volatile IT market.

In the IT market

To enable better purchasing power, buyers and sellers of IT alike need to have the ability to identify price changes up and down in the shortest possible time.

The process of price discovery can be facilitated with emerging technology ‘tools’ that enable users to investigate, unearth and discover new pricing by bringing together and standardizing critical market data.

For Mercato ITelligence, price discovery is considered to be the ‘golden fleece’ of delivering cost reduction on the purchase of IT products.

The analogy is drawn with the financial markets where a good market is ‘an efficient market’, where forecasts about future risk and return (movements) determine valuation.

The price observed at an instant in time on the ideal efficient market is a good assessment of future risk and return.

This price is not constant, because new information is being constantly generated in the economy. This is closely analogous to the IT market where availability and supply-demand dictate price and a highly volatile market.

How price discovery works

• Speculators in markets observe new information before buying, from a fresh sense of risk vs return (IT prices rising or falling) and discover that the present valuation on the market or agreement is out of date
• Speculators or IT buyers then actually risk budget in taking a position on the market and buying in. As IT product is bought, so stock levels decline and supply-demand balance begins to impact price
• If a buyer acquires new market information that justifies a lower valuation, then he will look to buy at a cheaper rate. Efficient and quick market technology helps an IT buyer discover that one price is cheaper than another at the same time as enabling them to re-evaluate their ‘buy-in’ to a product based on other supply chain related information such as the decline in dollar exchange rate. This activity serves to feed new information into prices, stock and price policing

Price discovery dynamics can be considered the beating heart or poisoned chalice of financial or IT markets depending on your position in the market – buyer, reseller, distributor, manufacturer. However, speculators do price discovery and without speculators a financial market would not exist.

An efficient market is one that must exhibit volatility. When ‘news’ breaks, prices must respond. An efficient market is one where new information is rapidly captured into prices and stock. A better market is the one that reacts fastest. This is often a market that appears to be highly volatile.

The technology role

Technology and the internet have played a critical role in delivering information to buyers and sellers in real-time. The financial Stock Market is backed by aggregation technology.

Mercato Solutions’ has aggregation, cleansing and enriching of real-time data at its core. This unique capability for large scale data management coupled with deployment of tools that help users buy better to save money or sell better to make money, is delivering real-time data to the finger tips of buyers in the same way that the stock market delivers information to traders.

Mercacto’s benchmarking tool applied to the IT vertical is called Mercato ITelligence, which is a simple online tool that advises IT buyers of trade guide price and stock levels on IT products. This technology empowers IT buyers with market knowledge, so they can rapidly negotiate down the price of IT products with contracted suppliers.

Buyers simply input supplier product lists or spot checks online for an automated comparison with trade guide price and stock in the UK IT supply chain. Powerful and efficient data management behind Mercato ITelligence compares over 500,000 line items to deliver price, stock and product information on over 150,000 ‘live’ products from more than 2,500 manufacturers.

The user discovers what margin their supplier is proposing and receives daily alerts in relation to their Product Lists, stating whether price or stock have moved.

Management functionality provides insight and validation of current purchasing ability and expenditure levels. Plus, the tool can automatically generate Request for Quotations (RFQs) in order to speed up the process of actually buying.

Mercato ITelligence enables purchasers to:

• Identify fair price and qualify agreed margins
• Recover historical over-charging
• Monitor and track price fluctuations
• Generate automated Request for Quotations to speed-up buying
• Stay on top of market developments
• Plot key market trends to forecast price and stock
• Strengthen supplier relationships with transparency

This technology and the enhanced price discovery that it enables is helping buyers stay ahead of the IT market and supply chain dynamics to buy better value product more consistently. Mercato technology is accredited by CIPS for offering procurement excellence.

This type of technology is particularly beneficial in the current climate where purchasers are being challenged to minimize the impact of rising IT prices.

A supply chain and price dynamic turned on its head

As IT buyers strive to meet demands for cost reduction, IT trade prices are on an increasing trend thanks to the volatility of the global economy. This is one of the most volatile price and stock periods the IT industry has seen.

In Q12011 to date, raw material costs have increased by 27% (copper, steel and plastic) and manpower cost in China has gone up 30%, whilst fluctuating exchange rates are also playing a key role in directing volatility.

To these three economic factors, the addition of certain specific product and manufacturer battles in the marketplace, is further impacting on dynamism of the 2011 IT supply chain

It is believed that there has rarely been as many global factors coming together at one time.

With IT budgets being tightened and IT prices increasing, IT buyers’ skill sets are clearly being tested to the limit.

The IT industry and buyers are having to deal with a product lifecycle turned on its head.

Prices usually decline over time as product passes through the lifecycle, now prices are bucking the trend and increasing during the products life. This is a culture shock for the industry and those on the buy-side.

UK supply chain data from Mercato ITelligence has qualified these trends with the number of product price changes growing considerably over the last six months to date. As an example, Memory over the last few months has been in short supply. As always in such a status, prices have increased but this reversed in January 2011 when the new manufacturing plants came on stream and we are back into over supply and price is reducing again.

The IT market place is a dynamic market. On an average day there are approximately 8,000 price changes. But the Mercato ITelligence data bank has logged over 10,000 price changes per day on 70% of days during the last 7 months. This is 20% higher than normal price volume changes. On 15% of days in the last seven months, price changes exceeded 20,000 in a single day. This represents more than 2.5 times the normal expected price changes per day.

However, on peak days there were over 30,000 price changes in a single day. The biggest day saw 34,750 changes on July 6th whilst the second biggest day was August 3rd with 30,968 price changes. This represents more than four times the normal expected daily price changes for a single day.

On these 2 days approximately 20% of all IT products in the market changed price.

However, price is just one pivotal factor in the dynamic IT marketplace, the other is new product introductions.

On an average day, the market expects approximately 300 new products per day, which equates to 72,000 per year. In the last 3 months that rate of change has almost doubled with a peak in January 2011 of 1,466 new products in a single day. This is unprecedented. New products are a mechanism that can be used by manufacturers to disguise pricing changes. By changing the spec of a product they change the price.

In an average supermarket there are approx 20,000 food products on display, the Mercato ITelligence data bank or catalogue this month shows over 150,000 live products.

Price changes in IT are normal, new product introductions are normal but the big difference with the IT market currently is the rate of change. No other market moves as fast as the IT market or boasts such a large product range as the IT vertical.

In the context of price discovery

The best and more specialist buyers of IT are securing data and then applying vast swathes of knowledge to that information to help them buy more intuitively. This means using the information they gather, and inherently the price discovery process, to stay ahead of the market and plan buying patterns, forecasting when is the best time to buy for best value.

Forecasts have suggested that if more buyers adopted emerging technology for price discovery, particularly in the public sector then pessimistic savings in excess of £1bn could be expected.

However, there is a general shortfall in IT buyer knowledge as to the greater global supply chain and the factors affecting it. Provision of data is all well and good but without knowledge transfer up to buyers from the supply chain, genuinely informed purchasing decisions will continue to be a challenge.

There is a call to action for buyers to become ever more engrossed in understanding the IT supply chain and factors influencing it, price and stock. Without this knowledge there is only so much that emerging technology can do to stimulate price discovery and achieve sustained best value purchases. Although technology providers from within the IT marketplace, like Mercato, are offering guidance, updates and training on market trends.

Without an understanding of all the factors impacting on the supply chain at any given time it has become increasingly difficult for IT buyers to truly forecast and plan when is a good time to buy or not.

Many IT buyers lack tools or deep levels of supply chain information for informed comparisons, this is detaching them from keeping track of the volatile marketplace and achieving best value purchases consistently.

As a result, more people are buying ad hoc and accepting less than best value on purchases. This is impacting on the bottom line of organisations at a time when budgets are shrinking and Financial Directors are being challenged with more defined budgets and ROI accountability.

For the professional IT manager tested with maintaining an IT system and buying IT, there simply isn’t enough time in the day to absorb reams of information regarding the supply chain to facilitate better judgment of value at point of purchase. Likewise, procurement professionals cannot be expected to absorb enough information on such a volatile market to buy best value without support.

This means the process of price discovery is slow and perhaps meaningless as the volatility of the market dictates price and stock changes are happening by the minute.

However, for those in a multifaceted role that includes buying, technology like Mercato ITelligence can offer a fully accredited best practice ‘tool’ that will deliver price discovery through an efficient marketplace for greater levels of sustained best value purchases and time savings.

This is particularly appropriate technology during the tough economic conditions when buyers are ever more pressured to deliver on numerous objectives. The technology is proven to help with average savings of a working week in man hours and considerable cashable value on IT budgets. It shortens the time to discover better prices to seconds from hours with automated alerts.

There has never been a better time for buyers to adopt best practice processes and investigate tools that will help them keep a finger on the pulse of IT stock and price, saving them time and money. Efficient marketplace technology exists and buyers now have the power to discover prices faster than ever before.

The next step is for buyers to absorb themselves in the finer dynamics of the supply chain to judge future buying patterns based on today’s information.

0845 111 4006
www.mercatoITelligence.co.uk
www.mercatosolutions.com

With strong growth of 1219% over the last four years, the business has developed a track record for helping organisations save and make money by transforming the roles of buying, selling and service delivery with large scale data management and simple online software tools.

Mercato is delivering world-wide roll-outs for organisations like IBM and global insurer JLT, helping them to reduce operational costs, transform competitive advantage and shorten sales cycles. The business has also delivered CIPS accredited eprocurement technology for suppliers of Government Procurement Service.

Mercato Solution’s Managing Director, Peter Robbins, said: “As austerity grips the world, we continue to support organisations in getting more from less with configurable tools delivered from the Cloud.

“Whether that means getting greater results from a sales team or driving down the cost of products and process in procurement, our customer-centric focus is introducing more efficient and joined up ways of working for both public and private sector organisations. We major on transforming the way business is done.”

Chris Robertson, partner and head of Technology, Media and Telecommunications (TMT) at Deloitte in Birmingham, comments: “The Deloitte Technology Fast 50 measures levels of sustained revenue growth over five years. Given the very challenging market conditions we have seen since 2007, this represents an impressive achievement for the four Midlands businesses ranked.

“This year’s ranking also highlights the importance of finding a niche product or service to beat the sluggish economy. The wide variety of rapidly changing devices and operating systems currently in use means that TMT companies need to be a step ahead, not only to identify these changes, but to form an effective business model around them.”