photo by karl steinbrenner supplier strategy moving vendors from level 1 to levels 2 or 3 valerie j...
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Photo by Karl Steinbrenner
Supplier Strategy
Moving Vendorsfrom Level 1
ToLevels 2 or 3
Valerie J Smith, CPCP
NASACT 2008 Charge Card Administration 2
Supplier Strategy
-Acquiring Bank/Merchant Service Providers Enables suppliers to accept and process charge cards. Provides training, set up, software and support for transaction
processing.
-Cardholders Cardholders, Buyers and Procurement representatives that purchase
products, goods or services from the merchant.
-Card Provider Issuing Bank for the Purchasing Card used by cardholders. Supplier Strategy:
NASACT 2008 Charge Card Administration 3
Supplier Strategy
- Level I provides basic credit card purchase information including but not limited to; Supplier name, Merchant Category Code, Date and Total purchase amount.
- Level II adds additional information to level 1 elements including but not limited to; Customer Code, Sales Tax amount, Vendor Tax ID, Outlet zip code and Minority & Women Owned Business status (MWOB).
- Level III adds line item detail to level I and level II elements including but not limited to; Customer Code, Sales Tax, Item Description, Item Quantity, Item Unit of Measure, Product Code, Freight amount and Extended Item amount.
NASACT 2008 Charge Card Administration 4
Supplier Strategy
- Level I Basic Data – Standard Interchange Cost, only transaction data passed to client, supports e-commerce initiatives
- Level II Improved Data – Lower Interchange Costs, ability to send client limited line item information, supports e-commerce initiatives.
- Level III Superior Data – Lowest Interchange Costs, ability to send client invoice level details, supports e-commerce initiatives, and ability to qualify for Large Ticket Discounts
NASACT 2008 Charge Card Administration 5
Supplier Strategy
- Analysis of Data
- Work with Card Provider to facilitate
- Have it matched with Platform vendors
- Return data with:- Matched – accepting- Un-Matched – not accepting- Level set up as – 1, 2 or 3- Any additional data – Socio Economic
NASACT 2008 Charge Card Administration 6
Supplier Strategy
- Ways to Match
- Federal ID
- Vendor ID
- Name
- Address
NASACT 2008 Charge Card Administration 7
Supplier Strategy
- Analyze Vendor Volumes
- Volume
- Transaction Count
- Average transaction cost
NASACT 2008 Charge Card Administration 8
Supplier Strategy
- Design Target Audience – Phase #1
- Vendors with
- High transaction counts
- Low transaction costs
NASACT 2008 Charge Card Administration 9
Supplier Strategy
- Design Target Audience – Phase #2
- Vendors with
- Low transaction counts
- High transaction costs
- If that level of volume can be on a card
NASACT 2008 Charge Card Administration 10
Supplier Strategy
- Design Target Audience – Phase #3
- Vendors with
- State Contracts
- Recurring Charges
NASACT 2008 Charge Card Administration 11
Supplier Strategy
- Determine Target Group Size
- Critical to be a success
- Can do a blast letter mailing – very low response
- Limiting Size to enable personalization
- Get a buyer to participate
NASACT 2008 Charge Card Administration 12
Supplier Strategy
- Targeted Letter, Call or Face-to-Face
- Decide based on your phases
- Should we do a letter followed by a call- The letter gives a Heads up so it does not seem as a cold
call
- Should we just do a letter- Normally low response rate
- Should we do a vendor fair- Invite a small group of vendors- Have provider assist
NASACT 2008 Charge Card Administration 13
Supplier Strategy
- Follow Up
- You must have follow up to be a success
- Always follow up with vendors- They are busy people too
- Remind them of the financial benefits