Are You Getting What You're Paying For?

Benchmark study highlights purchasing trends.

When it comes to the people paid to spend your money, are you getting your money's worth? According to a recent study, trendlines show that companies are hiring more purchasing employees, paying them higher salaries and spending more to train them.

CAPS Research, a supply management research organization jointly sponsored by the
W. P. Carey School of Business and the Institute for Supply Chain Management, created a purchasing benchmark by studying 20 industry sectors over a three-year period: aerospace/defense, chemical, computer hardware, computer software, diversified foods and beverages, Department of Energy/National Nuclear Security Administration contractors, electronics, engineering/construction, financial services, health-care products, industrial manufacturing, leisure, lodging and restaurants, metals and mining,
petroleum, pharmaceuticals, retail, semiconductor, telecommunication services, transportation
services and utilities.

Some of the report highlights:

Purchase spend as a percentage of sales dollars
2006 42.74%
2005 40.88%
2004 47.60%

Purchase operating expense per purchasing employee
2006 $107,521
2005 $106,869
2004 $99,959

Purchase employees as a percent of company employees
2006 2.72%
2005 1.45%
2004 1.22%

Percent of purchase spend via eProcurement
2006 20.47%
2005 15.14%
2004 17.30%

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