How Metalshub’s Normalisation Feature Improves Raw Material Procurement

Efficient comparison of quotes is essential for raw material procurement. Not an easy task when comparing offers across various currencies, incoterms, and other parameters. This is why we have built the normalisation feature.

The feature, which is part of our Procurement Solution, allows procurement teams to normalise offers to a common baseline for an apples-to-apples comparison and to make accurate, data-driven decisions.

With Metalshub, finance and procurement teams can centralise and manage important data, such as exchange rates, transport costs, and import duties. This removes the need to update or verify information across different files or manually request the latest information from the finance team.

The data is centrally managed across multiple production sites and countries to ensure all procurement managers are considering the correct parameters when comparing offers during a raw material purchase cycle.

For steel mills, foundries, and smelters, raw materials contribute 50-70% of the total cost base. Thus, making the right buying decisions across multiple offers directly impacts the business performance. This is where Metalshub helps buyers.

First, the compare screen gives buyers a clear overview of all the offers, highlighting key differences against the requested parameters of the enquiry for quick and easy comparison.

Second, rather than manually converting currencies and accounting for differences in delivery terms across multiple Excel spreadsheets, Metalshub users can leverage the integrated normalisation feature to align all offers with the terms of the enquiry.

The built-in normalisation calculator automatically calculates the total cost per offer, giving you clear insights on total spend without any extra work. For example, a CIF offer in Renminbi can easily be normalised and compared to a DDP offer in Reais.

Once normalised, the enhanced transparency makes negotiations easier, as all the key details are immediately visible. There is no longer a need to switch between various tools to manage discussions. Each cost item is broken down into separate rows, ensuring all parties have access to the same data for negotiations.

After the tendering process ends, the calculated values remain accessible. This simplifies audits and lets you review previous tenders when needed. By maintaining access to historical data, you can track cost trends and use past information to inform future decisions.

Metalshub’s normalisation feature operates with a single click. Once you’ve set the parameters, the platform automatically normalises and compares the offers. This reduces the possibilities of calculation errors as well as time spent on manual calculations, allowing procurement teams to focus on robust decision-making.

For those looking to enhance their procurement process, Metalshub’s normalisation feature is a tool that delivers immediate results and ensures buying decisions have a positive impact on the business.