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Pricing and Purchasing Service

Pricing and Purchasing Service. Understanding supplier costs Enhancing supply chain efficiencies. Global Insight Pricing and Purchasing Service.

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Pricing and Purchasing Service

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  1. Pricing and Purchasing Service Understanding supplier costs Enhancing supply chain efficiencies

  2. Global Insight Pricing and Purchasing Service When it comes to planning purchases, setting budgets, and bidding proposals, it can be tough to make the right decisions. Global Insight’s Pricing and Purchasing Service can help: • Benchmark buys versus market prices • Understand market fundamentals and the impact on supplier’s cost structures • Effectively assess supplier quotes • Enhance strategic timing of buys to capture maximum savings • Improve project cost estimation process

  3. Global Insight Credentials For over 25 years, Global Insight has been the recognized leader in providing detailed price and wage projections to companies around the world. Our credentials are second to none. 23 offices in 12 countries 325 experts fluent in 30+ languages 170 industries and 200+ countries covered 140+ advanced degrees

  4. Forecasts based on market fundamentals Global Material Prices and Wages Detailed Global Historical Data Commodities and Wages Our Pricing and Purchasing Service contains detailed global information for over 800 commodities and wages. Extensive historical market data combined with our projections can help you more effectively manage your supply chain costs.

  5. Assess Supplier Quotes Assessing supplier quotes is simple with the Cost Analyzer. This Excel-based tool lets you access our commodity cost structures and detailed market projections. By analyzing an industry’s cost structure and end-market demand you can easily determine if a price hike is justified and whether there is room for negotiation.

  6. Assess Supplier Quotes For example…Your circuit board supplier has increased their price by 3%. Is it justified? Labor(Represents 37% of cost)2.5% Increase Capacitors, Resistors & Various Components(Represent 33% of cost)1% Decrease The increase is too high. An increase of 1% is justified Semiconductors(Represent 10% of cost)2% Increase Equipment/Components(Represent 15% of cost)2% Increase Solder and Supplies(Represent 5% of cost) 0% Increase

  7. It appears as though you are getting a good deal… …until you include productivity adjustments. Benchmark Costs Margin Analysis – How Firm is that Quote? Our Cost Analyzer allows comparisons of market prices to suppliers’ costs, including productivity adjustments that tell the real story. A total market perspective, which includes demand, cost, productivity, and market drivers, allows you to identify industry margins and evaluate supplier performance. Construction Machinery and Equipment Armed with this data, you can go back to the table and negotiate a better price.

  8. Understand Markets Understanding the market is key to projecting price changes. All too often, purchasers make the mistake of using last year’s increases to forecast this year’s prices. About half the time, they are paying more than they need to. Prices are at a Turning Point Global Insight forecasts whether costs will rise or fall, allowing you to negotiate the best price or determine the best time to buy. 2.7 6.0% 2.4 4.0% 2.1 2.0% 1.8 0.0% 1.5 -2.0% 1.2 -4.0% 0.9 -6.0% 0.6 -8.0% 1996 1998 2000 2002 2004 2006 Global Insight Industrial Materials Price Index, Jan 2002=1.000 Industrial Production, G7 Economies, Year-Over-Year Change

  9. Avoid Cost Overruns Choosing the right index is critical to projecting future expenses. Too broad or too narrow a category might cost you millions. Our Pricing and Purchasing Service simplifies this process by offering over 1000 different proxies, enabling you to find the closest possible match. The Wrong Index Can Cost Millions! (Pct Chg) 8 6 4 2 0 -2 -4 2000 2001 2002 2003 2004 2005 2006 2007 2008 PPI, Aircraft PPI, Nonferrous Forgings CPI (All Urban)

  10. 1000+ Indicators With our vast selection of global prices, wages, and exchange-rates, you can select the indicators most applicable to your supply chain… …and we instantly present past commodity/wage performance and future trends, allowing you to benchmark purchases and project future costs.

  11. Compete Globally To compete globally, you need to assess multiple locations around the world. Effective global expansion requires consistent price and wage intelligence across countries and regions. The Cost Analyzer contains over 250 international price and wage indexes and a wide assortment of exchange rates. The service tells you how much wages are today… and how much they’ll grow tomorrow. Where to Locate a Manufacturing Facility? 2004 Compensation and Annual Percent Change in Unit Labor Costs Pct Chg $35.00 8.0% 6.0% $30.00 $25.00 4.0% Hourly Manf Comp 2.0% $20.00 $15.00 0.0% -2.0% $10.00 $5.00 -4.0% U.S. Taiwan Korea Germany Hourly Comp - left Unit Labor Costs - right

  12. Analysis Behind the Numbers More than just a database, Global Insight’s Pricing and Purchasing Service gives you the analysis behind the numbers, enabling you to understand industry fundamentals and the drivers of price changes.

  13. Get the Upper Hand With Global Insight’s Pricing and Purchasing Service, you will: • Achieve greater accuracy in cost benchmarking, quotation analysis, and project-cost estimation • Gain more leverage in contract negotiations • More effectively set purchasing budgets and defend them with management • Improve supply chain management

  14. The Savings Add Up Our Pricing and Purchasing Service finds the hidden money in your supply chain to maximize savings! • The Center for Medicare and Medicaid Statistics uses our detailed price and wage forecasts for setting reimbursement rates for health facilities. • The U.S. government’s Defense Contract Audit Agency (DCAA) uses our inflation projections toevaluate contract proposals for many federal agencies. • A transportation equipment manufacturer used our Pricing and Purchasing Service and saved $2.2 million in one buy. • A diversified machinery manufacturer used the Cost Analyzer and saved $60 million in one year.

  15. Contact Us Find the money hiding in your supply chain. Call us today: North and South AmericaMark Ulmer +1.202.481.9229 mark.ulmer@globalinsight.com Europe, Asia and Africa Jenny Sleep +44.20.7452.5199 jenny.sleep@globalinsight.com For more information: www.globalinsight.com/Pricing

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