Revenue, Risk and Regulations

Chartered Institute of Purchasing and Supply
London, United Kingdom

Course Format: Classroom | E-learning | Virtual Class | Online | On-site | Blended | Self-paced

Course Description:

'' The central theme of this event is to enable senior procurement professionals to recognise the risks involved in working with suppliers to show favourable reported revenue early in the supply relationship.

Aims
Vendor organisations are driven by the need to make money and demonstrate this ability to the marketplace. There is no better health indicator than booked revenue. However, posting revenue before it is actually realised is a dangerous game for all concerned. The most obvious problem is that over-reporting is a criminal offence, but there are many other implications for the buyer-supplier
relationship.
The procurement team needs to:

acknowledge the potential risks
realise how this collusion limits their negotiation power
understand the pressure that the supplier sales team is under
learn how to push back


By creating a favourable revenue picture, suppliers are painting themselves into a corner. Flexibility and the ability to react to the evolution of a contract are limited by the need to prove that the revenue exists at the time it has been reported. Whilst stage payments are a perfectly acceptable way of doing business, what happens when a deal goes wrong e.g. a component fails, a delivery goes astray, and a supplier further down the line fails to make the grade? In a nutshell, the procurement organisation won¡¯t pay the next ¨C and maybe any future ¨C payments, and the reported revenue fails to materialise. A damaged relationship ensues; the procurement team hasn¡¯t got the goods or services it requires, with all the implications that entail, and the supplier is at risk from all sorts of perspectives, including its shareholders, its reputation, financial regulations and ultimately, the law of the land.

In addition, this MasterClass will help senior procurement professionals identify the reality of the impact of regulations on their contracts. As a procurement professional, you are looking to make the best possible deal for your organisation. Beyond the price negotiation, you may ask for a discount, preferential payment terms or perhaps an upgraded warranty. Experience tells you that the vendor will do their best to give little or nothing away, quoting SEC regulations, accounting rules and their auditors as reasons why they can¡¯t concede on these points. In fact, no rules exist to prevent them offering these enhancements to a contract and this event will demonstrate where the real pressure is coming from and what the regulations really are.

With a maximum of twelve attendees, the format of this event affords delegates ample time for case examples and various mechanisms to be discussed in an informal but highly productive manner.

...''

Phone:44 (0)1780 756777

School Address:

The Chartered Institute of Purchasing & Supply
Easton House,
Easton on the Hill,
Stamford,
Lincolnshire,
PE9 3NZ

United Kingdom


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