LONDON--(EON: Enhanced Online News)--According to the latest procurement intelligence report from Technavio, the global MRO equipment and supplies market is expected to grow at a CAGR of almost 5% over the next five years due to the increase in need to reduce production downtime.
“To stay ahead of the competition, several suppliers are incorporating technology into their offerings to enhance efficiency and increase buyers' visibility on various aspects of the MRO supply chain”
The research report titled ‘Global MRO Equipment and Supplies Market: Procurement Intelligence Report 2017-2021’ provides an in-depth analysis of category spend, best procurement practices and cost saving opportunities, aimed at helping organizations achieve superior business performance. The report also provides insights on pricing, supplier positioning and top companies, enabling sourcing professionals to improve their competitive advantage through procurement excellence.
“Large firms, especially product manufacturing and facilities management organizations, focus on optimized use of non-production essentials such as MRO supplies,” said lead Technavio procurement expert Angad Singh, specializing in research on category spend intelligence. “To stay ahead of the competition, several suppliers are incorporating technology into their offerings to enhance efficiency and increase buyers' visibility on various aspects of the MRO supply chain,” added Angad.
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Cost Saving Opportunities in the MRO Equipment and Supplies Market
The adoption of various cost optimization levers helps buyers of MRO equipment realize cost savings and achieve category management and value benefits (including reduction in procurement complexities).
Technavio procurement experts have segmented the cost saving opportunities in the MRO equipment and supplies market into the following value-enhancement opportunities:
- Adoption of technology
- Supplier Competition
- Adoption of negotiation strategies
- Optimization of procurement practices
- Bundling of services
Adoption of technology
Inventory management solutions such as KeepStock help buyers save time and costs by reducing transaction costs, lowering inventory carrying costs, and enabling automated order processing.
Digitization interlinks of all aspects of MRO help maintain previous maintenance and service records and e-signatures. They also help suppliers plan for preventive maintenance. Digital MRO helps buyers and suppliers to provide proper information to the appropriate people at the right time
Optimization of procurement practices
Buyers of MRO equipment engage with multiple suppliers to meet their supply and demand for various production operations. For instance, a buyer engages with a minimum of 10 different suppliers to meet 70%–80% of the MRO equipment demand.
Buyers that procure MRO equipment in bulk cannot make a detailed specification analysis to determine the suitable product that matches requirements. Buyers depend on suppliers' knowledge and experience for suitable product recommendations based on requirements and the type of industry in which the buyer operates.
Bundling of services
Buyers that manage their inventory with the help of in-house procurement teams can exercise better control over demand planning by integrating inventory management software with the firm’s CMMS and other related software such as ERP.
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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