How effective procurement can help deliver outstanding customer experiences

Amazon Business is a Business Reporter client.

The need to provide a compelling customer experience should be at the heart of every organisation. For those working in procurement, this means being able to easily identify what they need to buy to help the business function effectively, and ensure it can meet wider goals around corporate responsibility.

This was the thinking behind setting up Amazon Business eight years ago, says Nicolas Olague, private sector leader, corporate, at Amazon Business, when it became clear many people were already using Amazon’s proven website and logistics infrastructure to make business purchases.

“The aim was to make it really simple,” he says. “We want our customers to focus on how to reach their procurement goals rather than how to use Amazon Business. The user experience is not much different to the one we have for consumers.” It can offer a complete experience, ranging from helping buyers research a product through to buying it and delivery, all accomplished through a tried and trusted infrastructure, he adds.

For European businesses in particular, which typically cover many different countries and markets, this can also factor in the need for both personalisation and localisation. One example would be flexibility around how and when items are delivered, says Olague, with some companies choosing to batch items into one delivery a week and others requesting deliveries on a specific day.

There’s support on the pricing side, too. “If we can see that you have purchased the same product a few times, we’ll suggest you use our Custom Quote tool,” he says. This allows buyers to submit an offer for a bulk purchase and outline their terms, which will then be sent to several potential suppliers. This typically leads to savings in the region of 10%, he adds.

Increasingly, though, delivering savings is not the only focus for procurement professionals. European businesses now expect procurement to be able to support wider objectives, with responsible sourcing and eco-friendly supply chain management seen as essential in the face of toughening legislation and pressure from consumers.

According to Amazon’s 2024 State of Procurement Report, which surveyed respondents from nine industries and across multiple countries including France, Germany, Italy and Spain, 81% of buyers have internal or external mandates to purchase from different types of certified sellers. Many of those respondents – four in 10 – who don’t have required purchasing goals still take supplier environmental, social and governance (ESG) factors into consideration.

A vice president of global procurement working at a technology company in Germany is one example. “From an environmental standpoint, we are working on a 50% reduction in our net carbon emissions by 2030,” they say. “We’re doing a lot more screening of suppliers to make sure they’re behaving like they should, so abiding by laws, disposing of waste properly and having risk mitigation plans in place for natural disasters.”

The most prominent factor when it comes to buying from particular types of suppliers is sustainability, which is a mandatory requirement for 59% of buyers. Four in 10 have a company direction to buy from certified small firms, and 39% from local businesses.

This, though, is not an easy matter, particularly when it comes to indirect categories of spend, which typically make up large numbers of relatively low-value transactions compared to direct spend. In fact, a staggering 85% of respondents say the difficulty of sourcing suppliers that follow sustainable practices prevents their company from setting or achieving sustainability goals for procurement.

Amazon Business can support responsible purchasing initiatives by making it easier for organisations to guide buyers to certified products and sellers, surface products with sustainability certifications, and proactively measure progress on responsible purchasing goals. This includes establishing a Climate Pledge Friendly buying policy, which organisations can mandate to ensure buyers only purchase items with sustainability certifications.

“On the buyers’ side, smart business buying facilitates connections with certified vendors,” explains Chris Costello, general manager, strategic accounts, at Amazon Business. “Our online purchasing tools offer user-friendly search and filter features, a platform to communicate directly with suppliers, and informational summaries for suppliers to explain key ESG information.”

“In this way, online buying becomes a valuable resource for reducing the time and effort it takes to vet suppliers and make progress toward responsible purchasing goals,” she adds. “With the right tools in place, procurement teams can help their organisations tackle goals related to environmentalism, diversity and more.” These might include policies that prefer smaller businesses or those from particular groups, such as women or ethnic-owned enterprises, while from a logistics perspective grouping items into fewer deliveries can help reduce carbon emissions associated with delivery.

Using technology to help create a reliable and responsive supply chain that can assist with specific demands of the business can help organisations in turn deliver high levels of service and satisfaction to their own customers. “Our objective is to enable you to be more effective and spend more time with your own customers,” says Olague.

This means putting in place rules around procurement, goals around sustainability and ensuring visibility around spend. “It doesn’t matter if you have five employees or 5,000, it’s the same process,” he concludes.

To find out more about how Amazon Business is helping European businesses develop more cost-effective and sustainable supply chains, visit https://www.aboutamazon.eu/news/company-news/amazon-business-customers-across-europe-accelerate-digital-transformation/