Professional Retail Store - March/April 2013 - (Page 73)

Sourcing How the RFP Process is Changing FM Today Q&A WITH DAVID CONNELLY PRSM ASSOCIATION SOURCING COMMITTEE CHAIRPERSON, STRATEGIC SOURCING MANAGER, DAVID’S BRIDAL A lthough the traditional Request for Proposal (RFP) has been in use throughout the retail industry for years, it has mainly been used for the sourcing and procurement of commodities. Over the last few years RFPs have been used more prominently on the facilities management (FM) front. To support this increased emphasis of utilizing RFPs to source for FM services, more sourcing personnel have been added to the ranks of many retailers’ procurement, or purchasing, departments, which are generally found within a retailer’s finance department. Primarily, the shift of sourcing for FM services being driven by finance developed during the recent recession and was primarily driven by the need for companies to reduce expenses. What is the key significance of the RFP in FM procurement today? The RFP, the document as well as the process, now play an important role for facilities managers, at the most basic level by providing a systematic approach to selecting a vendor partner best suited to meet the retailer’s requirements. The key phrase to consider is “systematic approach,” which is important because it can provide transparency to the process of selecting vendors, deemphasize the personal relationship aspect of engaging with vendors, and help ensure the requirements as defined by the FM department are met— all this of course is dependent on how meticulously the RFP is structured and how well the sourcing process is managed. In the long run I believe the increased emphasis on the RFP process will help make the services market more competitive. “ ” Procurement and sourcing merged with facilities management My perception is that more companies are putting greater emphasis on developing robust procurement departments, and those departments are engaging more actively with FM departments. There appears to be a trend of utilizing RFPs and systematic sourcing processes led by either FM departments, procurement departments or thirdparty consultants. I believe that the increase on the reliance of RFPs is because of the increased need for more transparency and accountability, not only within an organization but also by external factors such as validation for senior management and in the case of public companies, compliance with various legislations. In the long run, I believe the increased emphasis on the RFP process will help make the vendor market more competitive and therefore reduce costs to the retailers through increased efficiencies and innovation. Can both sides win/win at the RFP game? In my experience with utilizing the qualifying criteria of a RFP process, generally speaking, vendors with the right qualifications win the work and likewise retailers contract with the vendor best qualified to perform the service while providing the greatest value. Note that I said “greatest value” and not “lowest cost,” as I believe that overemphasizing the lowest costs will result in subpar services, essentially following the adage, “You get what you pay for.” Vendors should approach the process enthusiastically. It should be comforting to know that the retailer is doing their due diligence by performing a systematic qualifying process to fi nd a strong and viable partner. I can appreciate that RFPs are a lot of work and there is a higher loss than win rate, but it is a lot of work for both sides and ultimately the process should identify the vendor best suited to meet and ideally exceed a retailer’s requirements. For a vendor who hasn’t had to respond to many RFPs, I understand it can be an intimidating and sometimes unrewarding process. However, as vendors complete more RFPs, responding to them should become more rewarding. Your thoughts on how sourcing led by finance personnel is impacting FM? The dynamic can be challenging for both FMs and vendors when procurement becomes involved with www.prsm.com I MARCH/APRIL 2013 I 73 http://www.prsm.com

Table of Contents for the Digital Edition of Professional Retail Store - March/April 2013

PRESIDENT’S MESSAGE
EXECUTIVE DIRECTOR’S COLUMN
NEW PRSM MEMBERS
THE RIGHT PROVIDER WITH THE RIGHT PROGRAM
COVER, COAT AND COLOR
THE DARK SIDE OF PARKING LOT LIGHTING
PROACTIVE ROOF MAINTENANCE
ENGAGE AT PRSM2013 NATIONAL CONFERENCE
MANAGING YOUR PARKING LOT PORTFOLIO
SUSTAINABLE RETAIL OPERATIONS OFFER RETAIL FACILITY MANAGERS A GREAT DEAL
FOODSERVICE ADDS COMPLEXITY TO PM SCHEDULES
SHEDDING LIGHT ON A COMPLEX LED TRANSITION
THE OMNI-SHOPPER AND THE STORE
SOURCING: HOW THE RFP PROCESS IS CHANGING FM TODAY
ADVERTISERS' INDEX
RETAILER PROFILE: U.S. CELLULAR

Professional Retail Store - March/April 2013

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