duhu2000 UNIVERSAL RULES (apply to every spend task)
- NEVER accept a vendor risk assessment that contains fabricated financial data -- label all estimates and flag where primary data is unavailable
- ALWAYS include specific recommended actions with deadlines in every output -- observations without actions are not acceptable
MANDATORY OUTPUT HEADER
TASK: [e.g. Category Spend Overview -- Packaging -- FY2024]
CONFIGURATION: [Loaded: supply-chain.local.md / Not configured]
DATA SOURCES: [ERP / Finance system / Web search]
SPEND ANALYSIS WORKFLOW
Three Strategic Questions Spend Analytics Answers
Question 1: WHO are we actually buying from? -> Vendor concentration analysis; consolidation opportunity identification
Question 2: WHAT are we paying? -> Price consistency across sites/BUs; contract compliance monitoring
Question 3: WHAT SHOULD we be paying? -> Market benchmarking; renegotiation trigger identification
Analysis Types
Type 1: Category Spend Overview
DATA FROM ERP (define period: typically last 12 months):
- Total spend by category (top level and sub-category)
- Spend by vendor within each category
- Spend by business unit / site / cost centre
- PO compliance: what % of spend had a PO before the invoice?
OUTPUT:
CATEGORY SPEND OVERVIEW -- [Period]
================================================================
TOTAL SPEND ANALYSED: [X]
TOP CATEGORIES BY SPEND:
[Category]: [X] | [N] vendors | [N] BUs buying | PO compliance: [X]%
TAIL SPEND ALERT:
[X]% of spend is with vendors who each represent <0.5% of total spend.
[N] vendors account for [X]% of total spend.
Opportunity: rationalise tail to reduce transaction cost and compliance burden.
PO COMPLIANCE ISSUES:
[X]% of invoices received without prior PO (by category and BU).
Non-compliant spend: [X] -- escalate to Finance and Procurement leadership.
================================================================
Type 2: Vendor Consolidation Analysis
TARGET: categories with >3 vendors where commodity characteristics suggest consolidation would deliver price advantage without unacceptable supply risk.
CONSOLIDATION CANDIDATE CRITERIA:
- Multiple vendors supplying same specification / same category
- No strategic reason for multiple sources (i.e. not deliberate dual-sourcing)
- Combined volume would be meaningful to a single preferred vendor
- Competitive market with multiple qualified alternatives
CONSOLIDATION OUTPUT (per candidate category):
CONSOLIDATION ANALYSIS: [Category]
---------------------------------------------------------
Current state:
Vendors: [N] active vendors
Total spend: [X]
Price range: [low] -- [high] per [unit] -- [X]% variance
Price winner: [Vendor at lowest price] at [X] per unit
Consolidated state:
Target vendor(s): [1 or 2 preferred suppliers recommended]
Combined volume: [X]
Target saving: [X]% discount estimated at consolidated volume
Annual saving: [X] -- [X] (range based on discount range)
Risk assessment:
Supply continuity: [Single source risk? Mitigation?]
Switching effort: [Qualification, trials, tooling -- estimate]
Recommendation: [PROCEED / PROCEED WITH DUAL-SOURCE / MONITOR]
---------------------------------------------------------
Type 3: Price Consistency Check
IDENTIFY: same item or specification being purchased at different prices by different business units or sites.
DETECT WHEN:
- Same vendor code, same item code, different unit price
- Same item description, different vendor, significantly different price
- Same contract but different sites paying different prices
PRICE CONSISTENCY OUTPUT:
PRICE INCONSISTENCY REPORT -- [Category] -- [Period]
---------------------------------------------------------
Item: [Description and specification]
Vendor: [Vendor name]
Site/BU Price paid Volume Annual spend
[Site A] [X] [N units] [X]
[Site B] [Y] [N units] [X]
[Site C] [Z] [N units] [X]
Price variance: [X]% between highest and lowest
Best rate: [X] (Site [X])
Saving if all aligned to best rate: [X]/year
Action: Issue group pricing directive; notify all sites of best rate;
require contract compliance from [date]
---------------------------------------------------------
Type 4: Market Benchmark
USE WEB SEARCH MCP to identify:
- Published market price indices (commodity categories)
- Trade association price surveys (sector-specific)
- Publicly available tender results (public sector categories)
- Analyst market reports (technology, energy, logistics)
BENCHMARK OUTPUT:
MARKET BENCHMARK: [Category/Item]
---------------------------------------------------------
Your current price: [X] per [unit]
Market range: [low] -- [high] per [unit]
Your position: [X]% above / below market midpoint
Data source: [Specify source and date -- never fabricate]
Data quality: [HIGH -- published index / MEDIUM -- survey /
LOW -- estimate only]
IF ABOVE MARKET: Renegotiation recommended
Estimated saving: [X]% -- [X]/year at current volume
Timing: [Contract renewal date or next review]
Leverage: [Market evidence + volume commitment]
---------------------------------------------------------
Savings Pipeline Format
PROCUREMENT SAVINGS PIPELINE -- [Date]
================================================================
IDENTIFIED OPPORTUNITIES:
[Category] [Type] [Est. Saving] [Status] [Owner] [Timeline]
[Category] Consolidation [X] Draft [Name] Q[N] 20[XX]
[Category] Price alignment [X] Active [Name] [Month]
TOTAL PIPELINE: [X]
CAPTURED YTD: [X]
REMAINING: [X]
================================================================
NEVER DO THESE
- NEVER fabricate market benchmark prices -- always cite source and date; if no reliable benchmark available, label as "no reliable benchmark found"
- NEVER recommend single-sourcing a critical category without documenting the supply continuity risk and mitigation plan
- NEVER report "savings" without defining the baseline clearly: savings vs. prior contract / vs. market / vs. budget -- specify
- NEVER include tail spend vendors in consolidation analysis without checking whether they supply something unique or critical
ALL OUTPUTS REQUIRE REVIEW BY A QUALIFIED PROFESSIONAL BEFORE USE IN BUSINESS DECISIONS.