By Jill Button, President & CEO, ProcurePro Consulting
When top line growth stalls, it’s time to sharpen your focus on the bottom line.
Economic pressures, US tariffs, and an unpredictable global supply chain are squeezing profit margins everywhere. Canadian businesses, especially SMBs, are feeling it hard. The natural reaction? Cut headcount, freeze budgets, delay innovation. But those short-term tactics don’t solve long term problems.
There’s a smarter way to protect profits, and it doesn’t start with layoffs. It starts with strategy.
Why Cost Optimization Matters Now
We’re in a cost first economy. According to Statistics Canada, corporate profit margins have declined across sectors due to inflation, rising wages, and tighter credit. Many organizations are scrambling just to stay afloat.
But here’s the truth: if you’re not strategically managing your supplier costs right now, you’re leaving hundreds of thousands, possibly millions, of dollars on the table.
It’s not about slashing spend, it’s about making every dollar work harder.
Common Challenges Holding Businesses Back
You’re not alone if this sounds familiar:
- You don’t know what you’re spending, with whom, or why
- Contracts are auto renewing without review
- Your team is busy firefighting instead of thinking strategically
- No clear owner for supplier performance or cost accountability
These issues aren’t minor. They lead to budget leaks, overpayment, and wasted resources. I’ve seen it happen in public companies, private firms, and nonprofits alike.
The Strategic Spend Optimization Playbook
I’ve built a four step Agile Procurement methodology that works, whether you’re spending $1 million or $100 million. It’s grounded in my hands-on experience and delivers results fast.
1. Spend Analysis: Get Visibility
You can’t fix what you can’t see. That’s why we start with a spend tree, mapping where every dollar is going, by category, supplier, and contract status.
From my experience, tail spend alone, the 80 percent of suppliers representing only 20 percent of spend, hides 5 to 15 percent in savings. It’s inefficient, fragmented, and usually unmanaged. Just cleaning this up can unlock six figures in value.
2. Category Strategy: Build the Blueprint
Next, we create a category strategy for your highest impact areas, typically IT, marketing, or G&A. This isn’t just about benchmarking prices. It’s about aligning spend to business needs, understanding supplier dependency, and setting a clear sourcing plan.
In my book How NOT to Get Screwed by Your Suppliers and SAVE Millions, I talk about: “Not all suppliers are strategic. Don’t confuse high spend with high value. Some suppliers are mission critical, others are easily replaceable.”
Knowing the difference is how you stop overspending.
3. Prioritize Projects: Drive Focus
You can’t tackle everything at once. That’s why we identify and prioritize a Wave 1 roadmap, 3 to 5 projects with high savings potential and quick ROI.
A potential example project and approach: A financial services firm, Wave 1 project, through tail spend analysis in their IT category, could consolidate 20+ IT vendors under one strategic reseller to leverage consolidated volumes and streamline technology asset management and license compliance. Negotiating better pricing, reduced audit and non-compliance risk, and 3 year savings potential of up to $900K per $1M of annual spend, all without cutting a single feature.
4. Track Benefits: Show the Value
Too many optimization efforts die because results aren’t tracked. We implement a benefits tracker that measures forecasted versus actual savings, monthly, quarterly, and annually.
This helps your CFO see the ROI, keeps your team accountable, and ensures procurement is viewed as a value driver, not a cost center.
ShapeReal Results Without Risk
With this approach, clients consistently achieve 5 to 30 percent savings across their addressable spend. That’s $50K to $300K per million in spend, per year.
Over a three-year contract, that’s $150K to $900K per category. Not hypothetical, real, documented outcomes.
And we do it without burning bridges with your suppliers. We use market data, benchmarking, and structured negotiation to create win win outcomes. Suppliers stay profitable. You stop overpaying.
Industry Trends, Why This Matters Even More in 2025
The procurement landscape is only getting tougher, more sophisticated, and now more than ever Procurement professionals are being called to step up and help their business’s bottom line:
- Inflation: Still elevated and sticky in services and materials
- Geopolitical risk: Supply chains are vulnerable to US tariffs, port disruptions, and trade wars
- FX risk: Volatility in the Canadian dollar is impacting budget forecasts
- ESG demands: Stakeholders want responsible sourcing, but it often increases cost if unmanaged
- AI and automation: Technology can streamline tactical sourcing, but only if your strategy is right
If you wait until you’re underwater to fix this, it’s too late. Forward looking businesses are investing now in spend intelligence, supplier optimization, and cost governance.
Don’t Just Buy Smarter, Think Smarter
Let me leave you with this famous and meaningful proverb:
“The art is not in making money, but in keeping it.” — Unknown
Whether you’re a CIO, CFO, or founder, you need a clear category strategy, data backed decisions, and someone who knows how to negotiate outcomes that protect your business.
If your team is stuck being reactive, it’s time to bring in someone who can be strategic. That’s what we do at ProcurePro. We’re your virtual procurement partner, bringing 35 plus years of experience to save you time, reduce your risk, and unlock meaningful savings.
ShapeReady to Take Action?
Here’s what you can do next:
- Book a free discovery call: Let’s see where you’re leaving money on the table
- Download our Spend Optimization Playbook: Includes our category strategy checklist and benefits tracker
- Join our Substack newsletter, The IT ProcurePro for weekly tips on buying better tech and managing supplier risk
We’re not here to impress you with shiny slide decks. We’re here to help you buy better and keep more of your hard-earned money.