Method and Apparatus for Consumer Procurement Aggregation

Abstract

A method, system and computer program for accumulating information relating to product demand and consumption for each of a plurality of end users by a buying group representing a single purchase in bulk to disintermediate the supply chain, accumulating the received product demand into a predictive demand schedule by an expert service provider, and transmitting the accumulated predictive product demand schedule to a manufacturer / original source of the product by the expert service provider. Product availability information based upon the accumulated predictive product demand is received from the manufacturer / original source of the product, and is provided to the plurality of end users. One or more product orders are received, the product is ordered from the manufacturer / original source of the product, all aspects of the supply chain being managed by the expert service provider, and the product is shipped to one or more of the plurality of end users.

Description

CROSS REFERENCE TO RELATED APPLICATIONS[0001]This application is a continuation of U.S. patent application Ser. No. 13 / 372,324 filed Feb. 13, 2012 to Joseph Fedele, titled “Method and Apparatus for Procurement Aggregation”, the entire contents thereof being incorporated herein by reference.FIELD OF THE INVENTION[0002]This invention relates generally to a method and apparatus for aggregation of procurement of products and services at a much lower cost than individual enterprises can accomplish solely or conjunctively and more particularly to a method and apparatus for the disintermediation and aggregation of purchasing and acquisition of products and services for various (or all) industries in a way that provides efficient procurement of those products and services.BACKGROUND OF THE INVENTION[0003]Individual Enterprises are constantly seeking ways to increase efficiencies and reduce expenses in positive economic periods and especially in poor economic periods. This drive for efficien...

AI Technical Summary

Benefits of technology

[0009]In accordance with various embodiments of the invention one or more consolidated ERP systems are provided in which information is shared at various components of an improved supply chain, thus reducing the length of that chain, reducing the time from production to end user, and providing valuable demand information to producers and third party logistics to aid in production scheduling and logistics. This inventive “single ERP” system may allow for producers and 3rd party logistics enterprises to transition from a “made to stock” business model, in which products are produced and inventoried at multiple levels of distribution in anticipation of projected future demand, to a “made to order” business model, in which products are produced to satisfy real demand for the present and the future. Embodiments of the invention employ the process of disintermediation, defined as the exclusion of all middlemen between manufacturer or original source and the end user. In essence, all intermediaries that do not add value to the physical good or service are preferably removed from the supply chain, and consequently all of their associated or redundant costs are not passed on to the end user or customer (constituency).

[0012]Entities generally spend 80% of their expense for products and services (expenses) on 20% of the products and services they purchase. Implementation of various embodiments of the present invention may provide a system that will identify products and services which constitute that 20% of the products and services for targeted industry specific enterprises, and support the creation and functioning of industry-specific buying co-operatives that reduce costs for all enterprises in that particular industry not only by bypassing distributors and wholesalers, but by exercising the sheer purchasing power that the needs of combined enterprises in an industry generate. Information flow will be improved to encourage more efficient production, logistics, and distribution, thus decreasing costs throughout the system that may be shared by all constituents or sectors of this new supply chain. Additional cross-industry- (or multi-industry) buying cooperatives may be provided to support purchase of the other 80% of products and services that make up 20% of enterprise's spend. Because of the lower level of spending on these products by each enterprise, and consequently each industry, the combination of various industries into a single buying cooperative allow for similar benefits as the industry-specific cooperative groups, but for the less-used or less valuable products and services.

[0013]Various embodiments of the present invention therefore may provide a platform and channel for the individual enterprises to aggregate their demand into volume levels that are necessary (and advantageous) for procurement direct from the original source of the goods and services. Embodiments of the present invention may also provide for 3rd party logistics enterprises to carry out the function of logistics and fulfillment with greater efficiency and lower cost. Through the use of expert procurement partners, the aggregated individual enterprises' demand needs may be efficiently procured. Logistical experts may also provide the functionality of fulfillment logistics to bring to the enterprises their demand needs as required without the multiple redundant and / or costly factors that presently exist in the current supply chain.

[0014]One factor that may contribute to the deterioration of the quality of some products is the length of time it takes for a product to navigate the multiple levels of distribution and arrive from the point of origin to the point of final delivery (multiple handling through supply chain participants or companies), and including associated inventory level requirements at each level of distribution, including at the original source of the goods. Implementation of one or more embodiments of the present invention may mitigate delivery time and handlings by eliminating intermediaries and expedite the time and touches required for the product to arrive from the source to the point of delivery. Reducing the timeline and touches for deliveries only enhances product quality for a myriad of product categories, while reducing redundant supply chain inventory of products. Customizing products to better meet industry needs can also improve quality. Aggregating volume by cooperative members of the specific industries and dealing direct with a source of goods may give industry participants the benefit for negligible incremental cost (which will be minute in comparison to the savings derived from the disintermediation of the supply chain) to customize and manufacture products that gratify a particular functional need of an operation. By making goods to order based upon determined future and present industry needs, rather than making goods to fill various inventories in the existing supply chain, redundant inventory may be eliminated, and excess production may be avoided. End users receive desired goods and services as needed, for minimum cost.

Problems solved by technology

An individual enterprise's operators are limited in their ways of mitigating costs, and many reductions in cost tend to create additional problems.

For instance, reducing an enterprise's labor expense essentially diminishes service and negatively impacts the quality of product and / or service that an enterprise offers.

An enterprise's attempt to cut quality and services and / or increasing prices challenges its value propositions and can cause a decline or discontinuation of use or satisfaction.

First, the core competency of management in these industries is predicated on delivering the ultimate in consumer (constituency) satisfaction and not in efficient procurement methodologies.

Second, even skilled and experienced procurement managers cannot simply bypass the mainstream supply chain.

This supply chain contributes to the multiple-layered redundant infrastructure, occupancy, operating and distribution costs that are unavoidable to the end users (hotels, clubs, resorts, cruise lines, hospitals, colleges and universities, banks and financial institutions, governments, states, communities and a host of other entities) under the current systems.

Images