BusinessAnalytiq use-cases

USE-CASE: Track key market prices

Description of use-case

  • You want to track prices of key price indexes
  • You need a forecast for the key price indexes
  • You have a preferred FX for the indexes

Business Benefits

  • Add any indexes to your watch-list
  • Indicate preferred FX for tracking
  • See monthly changes in the index
  • Download all indexes on a monthly basis
  • See list of built-in indexes here

 

USE-CASE: Save time, cost & confusion

Description of use-case

  • All of your procurement team are collecting their own market data
  • They may or may not be using the correct FX rates for conversion
  • They may or may not be using the correct cost formula’s in their analysis
  • They may be using data from different sources for the same market index
  • They are wasting precious time preparing analysis that may infact be incorrect.

Business benefits

  • Save all the time & effort wasted on monthly updates
  • Have always up-to-date charts
  • Used agreed data sources, and cost-driver formulas
  • Ensure interpretation of FX translation is correct
  • See the impact of cost-driver movements
  • Always be ready to hold suppliers to account
  • Always be ready to update stakeholders

Key BusinessAnalytiq features

  • Have always up to date data from agreed sources
  • Have easy downloads quickly available
  • Ability to work with sources in multiple currencies and units of measure
  • Establish agreed cost-driver cost models
  • See the impact of cost-driver market changes
  • See the market outlook for many prices

 

 

USE-CASE: Download key data trends each month in minutes​

Description of use-case

  • You need regularly updated market prices
  • Your team needs to align on a sources for market data
  • You want to set the preferred currency
  • You need a single download file with all key data
  • You can ask Business Analytiq to add trends you need

Business benefits

  • Your team is aligned on the sources for market data
  • Data can be downloaded per month is 1 minute
  • Market data is updated automatically once per month
  • You can share data by email or upload to PowerBI, etc

USE-CASE: Create external leading indicators of direct material prices

Description of use-case

  • Prices of suppliers are constantly changing
  • You have a good understanding of the key cost-drivers
  • Key cost-driver price changes may signal coming price changes
  • 1-2 months warning of price pressure allows better planning
  • You can plan open orders, inventory, tenders, etc

Key business benefits

  • Get early warning on likely price pressures
  • Know exactly when and how to push for price decreases
  • Optimize planning of orders, inventory and tenders
  • Improve communication to internal stakeholders of risks
  • Develop understanding of risks and reduce surprises

Business Analytiq software features

  • Create indexes as leading indicators of likely price changes
  • You can fine-tune your leading indicators using historical data
  • BusinessAnalytiq indicates the likely size of the price change
  • Indexes are automatically updated each month
  • Charts are highly visual facilitating discussion and sharing
  • Can be used as informal price mechanism with suppliers to balance risk

 

USE-CASE: Set up and price external leading indicators for your business

Description of use-case

  • Most critical trends in your business will have external leading indicators
  • This is especially true of sales, materials cost and cost trends
  • For each area, you can work to establish and price external leading indicators
  • Leading indicators may signal change as early as a year in advance

Key business benefits

  • Get early warning on likely changes in sales or cost
  • Have time to prepare for coming changes
  • Understand the link between leading indicators and your business
  • Be the first to act on change
  • Improve communication to internal stakeholders of risks
  • Develop understanding of risks and reduce surprises

Business Analytiq software features

  • Create indexes as leading indicators of likely changes
  • Fine-tune your leading indicators using historical data
  • Indexes are automatically updated each month
  • Charts are highly visual facilitating discussion and sharing
  • Establish a new process for preparing outlooks

USE-CASE: Create cost-driver benchmarks for direct materials

Description of use-case

  • Your purchase a direct material
  • You know the key cost drivers
  • You want to track your price against cost- driver price developments

Business benefits

  • Internal alignment in team on key benchmarks
  • Leading indicators on likely price changes
  • Increased awareness of supply risks
  • Ongoing basis for supplier discussions
  • Useful tool for communication & price increase programs
  • Creates informal price mechanism

Key BusinessAnalytiq features

  • Create benchmark for key direct materials
  • Indexes can be combined from various FX
  • Confirm benchmark validity through statistics
  • Complex indexes are always up to date

USE-CASE: Always be well-prepared for supplier negotiations

Description of use-case

  • Build clear cost-driver models which apply to your suppliers
  • Fine-tune the cost-driver models against history
  • Have the cost-driver models update automatically each month
  • Get early warning of potential price increases
  • Get early warning of price decrease opportunities
  • Understand the supplier cost model is a key factor in establish better negotiations

Business benefits

  • Always be ready for negotiations to reduce costs
  • Be aware earlier of price decrease opportunities 
  • Build all possible market knowledge into you models
  • Have always up to date market information available in minutes
  • Establish an informal price mechanism with suppliers

Key BusinessAnalytiq features

  • Build a cost models per category
  • Establish key cost-driver models for key suppliers
  • Agree the models with your suppliers if possible
  • Use the models to try and establish a justification for price increases and price decreases

USE-CASE: Create market benchmarks for material inputs

Description of use-case

  • Your purchase a direct material
  • You need to know what other customers are paying for similar materials
  • You need to know market price developments of similar categories of products
  • You wish to know other potential suppliers

Business benefits

  • Improve your ability to negotiate lower prices
  • Get a direct market price benchmark of your inputs
  • Get a direct market trend for similar products
  • Find alternative suppliers of similar products

Key BusinessAnalytiq features

  • Find sources of prices for similar products
  • Identify suppliers of similar products
  • Confirm benchmark validity through statistics
  • Ensure direct benchmarks are always updated

USE-CASE: Always have a management update of trends and outlook available

Description of use-case

  • Stakeholders wish to be updated on material price trends and outlook
  • Management wish to have rolling outlooks of material prices
  • Sales staff need to supporting data on price increase programs

Business benefits

  • Always have the charts & data ready for presentation and discussion
  • Have clear visual charts as input to discussions
  • Simplify forecasting and budgeting with clear material price forecasts
  • Save cost & time with always updated indexes

Key BusinessAnalytiq features

  • Indexes are updated automatically each month with actual and outlook trends
  • Create weighted indexes per business unit, product type, customer, etc
  • Track notes of events for each index
  • Indexes are always available for sharing and presentation with no further work
  • Indexes can be shared online

   

USE-CASE: Prepare budgets, outlooks and forecasts

Description of use-case

  • Teams regularly need to present short term leading indicators, outlooks, budgets, and forecasts
  • Month-by-month detail and objective logic are required
  • Ideally outlooks should be always updated

Business benefits

  • Save cost and efforts in updating outlooks
  • Always be ready to discuss the outlooks at short notice
  • Create outlooks based on leading indicators,not gut-feeling
  • Ensure business stakeholders are aware of risks and opportunities

Key BusinessAnalytiq features

  • For all price trends there is an outlook built-in the tool
  • Up to date outlooks can be downloaded in less than a minute
  • Users can create complex models which will have an outlook
   

USE-CASE: Combine indexes into a single benchmark

Description of use-case

  • You need to create a benchmark indexes combining various materials, currencies and units of measure
  • The complex indexes need to be updated automatically
  • The indexes are used for benchmarking, negotiations, budgeting, and communication to stakeholders

Business benefits

  • Ability to quickly create complex benchmarks
  • Internal alignment key benchmarks and data sources
  • Save cost & time creating & updating excel files etc
  • Always up to date benchmarks
  • Use for negotiation, budgeting, forecasting and communication

Key BusinessAnalytiq features

  • Create a complex index from various materials, FX and UOM in less than a minute
  • Data sources can combine private data series with Business Analytiq data
  • Complex indexes are automatically updated each month
  • Indexes can be quickly downloaded each month for sharing or loading into management reporting tools

USE-CASE: Prepare customer price increase program

Description of use-case

  • When material prices are starting to increase, a price increase program may be required
  • The phases of a price increase program usually include:
  • a) Conditioning phase to pre-warn customer of risk of increases
  • b) Execution phase to implement price increases
  • As part of the price increase justification, sales and customer service staff will require documents to explain market conditions to the customer

Business benefits

  • Ability to see the risks of reducing margins earlier
  • Ability to start conditioning of customer and execution of price increase program earlier
  • Save time and cost preparing a price increase program
  • Make price increase program a core skill of your business

Key BusinessAnalytiq features

  • Powerful visual charts to explain market price trends and outlooks
  • Calculation of the impact of raw material increase on price of finished goods
  • Ability to show different charts for each customer
  • Charts are continuously updated and available online

USE-CASE: Identify areas of potential cost savings

Description of use-case

  • Unless you are a large customer and can switch suppliers easily, you are paying a premium price
  • You are paying a premium because the supplier understands that you cannot easily switch suppliers
  • The premium you are paying varies between suppliers, categories and products
  • Knowing where the premium you are paying is higher than the cost and risk of switching suppliers in difficult
  • It is important to be able to estimate the premium (as well as the cost of switching)

Business benefits

  • Identify areas of potential cost savings
  • Set a price target based on a granular cost model
  • Estimate the amount of potential saving

Key BusinessAnalytiq features

  • Build cost models per category or product
  • Prove the cost models against market trends
  • Estimate the potential cost saving against a reasonable market price
  • Establish granular cost-driver models for all your categories
  • Have the first result in minutes, and fine-tune over time

USE-CASE: Make better decisions based on the market data you are paying (a fortune) for

Description of use-case

  • If you procurement is in the millions, it makes good commercial sense to buy good market data
  • You are buying market price data and probably paying $000’s per year for the data
  • For most of the data you buy, you are only using it rarely
  • For most of the data you buy, you do not have a structured approach to using the data
  • You are wasting most of the data you buy because there is no structured process to track and interpret it

Business benefits

  • Drive lower market prices
  • Get more value from the data you buy
  • Eliminate the cost of buying some of the data which is proven not valuable
  • Understand where you are ahead and behind vs market trends
  • See opportunities earlier to generate cost savings
  • Set up price mechanisms with suppliers using your expensive market data
  • Hold your suppliers to account
  • Get good leading indicators for price changes

Key BusinessAnalytiq features

  • Build cost models per category or product
  • Ability to use your own private as a key input into your models
  • Clearly see where you are ahead and behind vs your market benchmarks
  • See the price decrease you should be targeting
  • Establish clear cost-driver models for your key categories

USE-CASE: Identify supply risks in your business

Description of use-case

  • Understanding the key cost-drivers of your suppliers helps you to see risks to your business
  • You will be more alert to outages or supply chain disruptions
  • You may discover that competing suppliers may be dependent on the same source of input materials
  • You may identify alternative suppliers closer to key cost-driver sources
  • You will understand price risks and supply risks better

Business benefits

  • Ability to understand risks to your business
  • Earlier identification of supply outages coming
  • Better understanding of what costs drives your prices
  • Better ability to find competing independent suppliers

Key BusinessAnalytiq features

  • Fine-tune cost driver models for your business
  • Prove the cost driver models against historic price movements
  • Ability to keep an eye on all key cost driver market trends
  • Work with sources in different FX and different continents
  • Get an early warning of market price changes

USE-CASE: Create price mechanism for suppliers or customers

Description of use-case

  • You wish to balance the risks of cost-variability between yourself and a supplier or a customer
  • You need to establish agreed parameters for the model in market indices and how to use them
  • You need a shared system to track those indices and the impact on pricing
  • You need to establish an informal process to calculate potential price adjustments, both up and down.
  • You share the risk and opportunities with the suppplier or the customer

Business benefits

  • Established process of managing risk and opportunity
  • Eliminate monthly or quarterly negotiations
  • Increase the transparency and trust between the parties
  • Focus the relationship of value-added topics, not destructive zero-sum negotiations

Key BusinessAnalytiq features

  • Establish key cost-driver models for key suppliers or customers
  • Agree the models with your suppliers or customers
  • Share the models across the internet so both parties can monitor the impact
  • Use the models as the key input into quarterly price reviews
  • Establish a shared price mechanism with suppliers or customers

USE-CASE: Improve your ability to negotiate when you cannot switch suppliers

Description of use-case

  • You cannot easily switch suppliers because
  • a) the cost of switching is higher than the cost benefit of reduced prices
  • b) there are limited suppliers and if you burn your bridges with 1 supplier, you may have less choice in future
  • If there is no short-term route to increasing competition between suppliers, you need to establish the best possible model for negotiating with your current supplier
  • Understand the supplier cost model is a key factor in establish better negotiations

Business benefits

  • Limit potential cost increases
  • Establish an informal price mechanism with suppliers
  • Understand the economics of switching suppliers better
  • Manage risks between supplier and customer

Key BusinessAnalytiq features

  • Build a cost models per category
  • Establish key cost-driver models for key suppliers
  • Agree the models with your suppliers if possible
  • Use the models to try and establish a justification for price increases and price decreases
  • Establish a shared price mechanism with suppliers