CASE STUDY / NARTA
Partnership boosts buying power
With a buying power of more than AU$3 billion, Australian retail group Narta is an innovative solution to a geographic problem. Its next step is to manage supplier relationships.
B usinesses in the same sector are natural competitors. They would do almost anything to gain an advantage over each other. However, when they face the same problem, it makes sense to come together as a group. The remoteness and size of retailers Australia and New Zealand can make it difficult for them to obtain competitive prices from international suppliers. Founded 54 years ago, the National Associated Retail Traders of Australia, was designed to address this problem, using the buying power of its members to leverage deals from global markets. Six years ago, it branched out into buying indirect goods and services for its members. Jen Barclay, Narta head of procurement, says: “With traditional buying models you are limited to your individual organisational spend; through collective sourcing you have greater opportunities to deliver value for your organisation, leveraging off total group spend and be a larger customer in the market. Essentially you go from being the little fish in the pond to the big fish in the ocean.” Beyond tactical procurement To build a buying team capable of delivering value from indirect categories, Narta formed a partnership with State of Flux, which conducted a pilot in 2013 and formed its own buying team on behalf of Narta. In 2016, the team became fulltime Narta employees. The approach has been successful. In the last year, the Narta procurement organisation has tended AU$300 million and saved around AU$80. It has
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STATE OF FLUX
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