Cost Is a Choice

Most companies treat what they pay suppliers as a fact. It isn't.

At a company that makes or moves things, the money paid to suppliers is often half or more of every sales dollar. It is also the sum of choices — what to buy, to what specification, from whom, on what terms — most of them made years ago by people who have since moved on. A few of those choices hold most of the money.

In Cost Is a Choice, Bill Canady, bestselling author of The 80/20 CEO, shows chief executives and purchasing leaders how to find those few and make them on purpose. Build one spend file that ties to the ledger, cut it 80/20, and take the fast money from overdue price reviews in the first hundred days. Then run the ten steps of strategic sourcing: should-cost before any bid, site visits with all eighty-four negotiable issues in hand, tough on the number and fair to the people, a second source for anything that can stop the line, and no saving counted until finance signs it.

One invented company, Bramwell Range Company, does all of it from Day 0 to Day 1,000, every sum worked in the open. The companion to The 80/20 Institute's PGOS Procurement Masterclass, with a separate Field Guide of forty worksheets.