Consortium and Aggregate Buying

I'd like to share information on a project that I was working on before but never really took off due to political reasons. It's basically a concept in maximizing profit through cutting cost which is what most company's are going through these days. The project is called Consortium and Aggregate Buying. This project was intended for large companies, nevertheless I wish to see this being used by small and medium enterprises (SME's) because of the tremendous benefits it can offer.

Ok so the idea goes like this, based from what it's called "Consortium and Aggregate Buying" it's exactly what it says. The gathering of resources or volume before buying. If your into a business then you must be selling some sort of product or services. In this case we'll focus on products. To sell a product one must manufacture it first and this entails purchasing raw materials (unless your a middle man in the supply chain).

Normally a manufacturing company buys their needed raw materials from whoever offers the lowest cost that's within their standard of quality. Big companies usually get a good price because of their huge volume compared to smaller companies who have minimal volume of the same item. Hence, small companies don't enjoy what big companies do in terms of their buying power is concerned. But what if we can level the playing field to the benefit of everyone. That means for the benefit of the buyer which is the manufacturing company and the seller which is the supplier. How do we exactly do this you might ask? Right, by means of Consortium and Aggregate Buying.

The idea is to pull in all the volumes of a particular item that is needed by these manufacturing companies and have the suppliers bid on them according to the volume that is required. Believe me the figures would be staggering. Now what would this mean to all the players, read further..

1. For large buyers that have enjoyed a good price from their existing volume, the cost can even be brought further down due to the added volumes from other smaller buyers.

2. For small buyers they can enjoy the benefits of what large buyers are enjoying. Imagine the saving they would be getting.

3. For the seller or bidder, an increase in market due to large amount of required volume.

To illustrate this click on the following link: Consortium Buying

Now there are a few drawbacks to this, first of which is the information of volume and current buying price that would be shared. Most buyers do not want to divulge this information due to competition reasons. Second is that this method breaks away from the traditional procedure of procurement that many are still reluctant to grasp change. Nevertheless, the benefit of this far out weights these problems. In all, this would be much easier to implement within a group of company that are associated with one another. All it takes is political will from top management.

Viewing the idea as big as it may seem, I believe this can be achieved in a much smaller scale even to the level of an owner of a sari-sari store. Say if you have about 10 sari-sari stores in your neighborhood all selling similar products, all of them can cut cost by pooling in their resources together. All it takes is cooperation and trust. It can also promote friendly competition. I know there are others that are already doing this through cooperatives and other grass root associations and I salute them for their efforts.

So there, I hope I have provided some valuable insights to those who are looking for ways to improve their business operation.

Oh by the way, the whole process of this idea can also be carried out online.

Thanks for reading...

Wise words from Washington Sycip

Unbeknownst to the man, I used to work in several of his companies (MacroAsia-Eurest and MacroAsia Corp.) as an administrative officer, here's an excerpt from an article that I just read that defines his character.

At age 89, renowned Filipino accountant-philanthropist Washington Sycip has seemingly perfect vision and a crystal clear memory. As he sits on his svelte swivel chair, one can see an oak table filled with books and broadsheets that fill his daily news diet.He wants to go beyond just making money – Sycip found purpose in helping those who are in need. He has a 3-pronged approach to reducing poverty – better access to basic education, microfinance and health services.
“The objective is to reduce poverty because if the nation is poor, a democracy doesn’t work,” Sycip said.
He singles out his education-related philanthropic engagements as “the most demanding of the non-paying jobs I have. There is a perfect correlation between poverty and education.”
Sycip finds an appropriate symbol for hope in the country’s future in his favorite brass sculpture in the office – the “Tree of Life” designed by a young Filipino engineer.
"The Filipino of many talents cannot die. There's a future if there's proper leadership," he said.

Recommended reading,


Asian Institute of Management: Kaiser Naseem, Tony Tan Caktiong, Robert Chandran, Washington Sycip Graduate School of Business

Real Estate Marketing Ideas

I'm writing this article in view of my experience I had when I was working as a Sales Manager in one of the real estate companies here.

As it is today, most real estate agents go by the traditional marketing method of booth manning and flyering at different high people traffic sites. And when asked to provide an alternative marketing plan, they most suggest with a different locations for flyering and booth manning again and again. This is ok since this has been effective for many sales team for quite sometime considering that most local real estate companies consider the numbers game wherein they field in a large number of real estates agents and capture sales according to their ratio meaning lets say for every 10 agents in the field they would expect a sale of 3-4 per month. Considering the policy that if one doesn't make a sale within 3 months he or she would be dropped from the roster, hence, many opt to leave and look for other opportunities. As for the real estate company, continuous hiring and training is a must to survive with this method and a lot of cost goes into this as well.

I view this method as a brick and mortar approach who's days are probably numbered with the advent of internet marketing. For those real estate agents and sales team who are reading this article and already know their way around marketing real estates over the internet, I congratulate you for many are still left in the dark. For those who have yet to discover the potential of this, I hope this article would help you.