businessinfomag.uk magazine 18 SOURCING adopting digital sourcing to get ahead. Orders from UK SME buyers during March Expo, one of Alibaba.com’s major B2B sourcing events of the year, were up 39% year-on-year (YoY). It’s a similar story across Europe, with order volumes being driven by growth in Footwear & Accessories (+105%) and Apparel & Accessories (+48%), partly in response to growing demand for sporting goods. During March Expo, orders from SMEs for casual sports shoes and football attire enjoyed YoY increases of 173% and 124%, respectively. SMEs must reconfigure their processes to keep up with changing market dynamics. Having a modern sourcing strategy is essential not only to find innovative and tailored products but also to future-proof supply chains in volatile times. Digital methods – like online marketplaces – offer SMEs a wider variety of suppliers, access to new products, competitive prices, plus a plethora of AI tools, all contributing to a stronger future and growing sales. finding trusted suppliers (40%), finding sustainable products (32%) and sourcing new and trendy products to acquire new customers (31%). SMEs increasingly recognise the value of digital sourcing in achieving these goals, with almost two-thirds (59%) of UK SMEs agreeing that digital sourcing is more important today than it was last year. Online sourcing platforms like Alibaba.com are particularly beneficial, giving SMEs access to a wide variety of global suppliers, new innovative products and competitive prices across 7,600 product categories at the click of a button, with minimal overhead costs. The integration of AI with Alibaba.com’s B2B search tool, Accio, brings additional productivity, efficiency and monetary benefits by turning vague product ideas into actionable, data-driven plans within just minutes. Data from Alibaba.com shows that SMEs are already SMEs are the lifeblood of the UK economy, making up 99% of all businesses. They drive innovation, create jobs and contribute to the economic growth of the country. However, economic headwinds are threatening their survival and creating barriers to growth. Traditionally, SMEs have struggled against large, wellestablished businesses with access to significant resources. In recent years, this gap has widened thanks to a combination of staff recruitment and retention challenges, stubborn inflation and high interest rates. While SMEs remain resilient, many understand that they need to react to these shifting market dynamics by embracing technology to remain competitive. The digital sourcing of ready-made and custom-built products is one way UK SMEs can future-proof their business and meet changing procurement priorities. According to research from Alibaba.com, these include becoming cost-efficient (43%), Michelle Lau, Managing Director of Alibaba.com, France, highlights the growing role of AI-enhanced digital platforms in SME sourcing strategies Sourcing for growth Michelle Lau Shadow spend rises to 10% of business expenditure One in every ten pounds spent by UK businesses is untracked and unmanaged, and the problem is only getting worse, with more than half of 300 UK supply chain decision-makers surveyed by Ivalua expecting ‘shadow spend’ to grow in the next 12 months. Stephen Carter, Product Director at the provider of cloud-based spend management software, warns that lack of visibility and control over business expenditure is preventing four out of five organisations from tracking spend, managing suppliers and securing the best pricing. This is fuelling budget overspend (cited by 73% of survey respondents), compliance risks (57%) and missed savings opportunities (53%). Carter said: “In a cost crunch climate, shadow spend becomes a drain on resources that is no longer sustainable and must be stopped. But getting to grips with shadow spend is impossible if organisations can’t see it happening. Without greater visibility and control over spend management, businesses are flying blind and running out of room to react.” Part of the solution, according to survey respondents, lies in better use of technology, including AI. Almost all (95%) believe spend analytics can better identify shadow spend; 86% believe automation can support shadow spend reduction, with 30% saying it can do so to a significant extent; and 84% agree that AI can help identify shadow spend, with 43% believing it will do so to a great extent. Beyond detection, AI is expected to enhance the employee experience, simplifying navigation of e-procurement portals, adherence to approved supplier lists and purchase order workflows and compliance with expense policies, thus reducing the temptation to buy outside procurement controls. Carter added: “By improving the employee experience, technology makes it easier to do the right thing, because if you can’t see where your money’s going, you’ll never control where it ends up.” www.ivalua.com Stephen Carter
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