U.S. patent application number 14/158831 was filed with the patent office on 2014-05-15 for method and apparatus for consumer procurement aggregation.
The applicant listed for this patent is Joseph Fedele. Invention is credited to Joseph Fedele.
Application Number | 20140136282 14/158831 |
Document ID | / |
Family ID | 48984613 |
Filed Date | 2014-05-15 |
United States Patent
Application |
20140136282 |
Kind Code |
A1 |
Fedele; Joseph |
May 15, 2014 |
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.
Inventors: |
Fedele; Joseph; (New Hyde
Park, NY) |
|
Applicant: |
Name |
City |
State |
Country |
Type |
Fedele; Joseph |
New Hyde Park |
NY |
US |
|
|
Family ID: |
48984613 |
Appl. No.: |
14/158831 |
Filed: |
January 19, 2014 |
Related U.S. Patent Documents
|
|
|
|
|
|
Application
Number |
Filing Date |
Patent Number |
|
|
13372324 |
Feb 13, 2012 |
8666791 |
|
|
14158831 |
|
|
|
|
Current U.S.
Class: |
705/7.31 ;
705/26.2 |
Current CPC
Class: |
G06Q 10/06 20130101;
G06Q 30/0202 20130101; G06Q 30/0605 20130101 |
Class at
Publication: |
705/7.31 ;
705/26.2 |
International
Class: |
G06Q 30/06 20060101
G06Q030/06; G06Q 30/02 20060101 G06Q030/02 |
Claims
1.-20. (canceled)
21. A non-transitory computer readable storage medium having a
computer program stored thereon, the computer program causing a
general purpose computer to perform a method for providing a supply
chain as a service, comprising the steps of: 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 on behalf of the buying group; transmitting
the accumulated predictive product demand schedule to a
manufacturer/original source of the product by the expert service
provider on behalf of the buying group; receiving product
availability information based upon the accumulated predictive
product demand from the manufacturer/original source of the product
by the expert service provider on behalf of the buying group;
providing the product availability information to the plurality of
end users by the buying group; receiving one or more product orders
from one or more of the plurality of end users in accordance with
the product availability information; ordering product from the
manufacturer/original source of the product and managing all
aspects of the supply chain in accordance with the received one or
more product orders by the expert service provider on behalf of the
buying group; and shipping the product from the
manufacturer/original source of the product to one or more of the
plurality of end users in accordance with the received product
order for each of the end users.
22. The method of claim 21, wherein the buying group comprises one
or more expert service providers.
23. The method of claim 21, wherein the plurality of end users
comprise one or more similar demand requirements.
24. The method of claim 21, wherein the plurality of end users
comprise one or more dissimilar demand requirements.
25. The method of claim 21, wherein the step of ordering product
from the manufacturer/original source of the product is made
available by one or more expert service provider in order to
provide the supply chain as a service, and disintermediate the
supply chain.
26. The method of claim 21, wherein the accumulated information
related to product demand comprises information related to past,
present and future product demand and consumption for each of the
plurality of end users.
27. The method of claim 21, wherein the predictive demand schedule
comprises a plurality of demand schedules.
28. The method of claim 27, where the plurality of demand schedules
are transmitted to the manufacturer/original source of the product
by the expert service provider on behalf of the buying group
29. The method of claim 21, further comprising the steps of:
transmitting the accumulated product demand by the expert service
provider on behalf of the buying group to one or more logistics and
fulfillment providers; receiving logistics information by the
expert service provider on behalf of the buying group from the one
or more logistics and fulfillment providers; providing the product
availability information together with the logistics information to
the plurality of end users by the expert service provider on behalf
of the buying group; receiving one or more product orders from one
or more of the plurality of end users by the expert service
provider in response to the product availability information;
ordering logistics services by the expert service provider on
behalf of the buying group from the logistics and fulfillment
provider in accordance with the received one or more product orders
if it is determined that a product order for the one or more of the
plurality of end users is less than a predetermined amount;
shipping the product from the manufacturer/original source of the
product to the one or more of the plurality of end users via the
logistics providers in accordance with the received product order
information.
30. A single enterprise resource planning (ERP) system
incorporating information seamlessly, predicatively between end
users, logistics and fulfillment providers and manufacturers or
original sources of goods and services, comprising: an input for
receiving information by a computer system operated by an expert
service provider on behalf of a buying group relating to product
demand and consumption for each of a plurality of end users; a
predictive engine implemented by a computer processor of the
computer system operated by the expert service provider on behalf
of the buying group for accumulating the received product demand
into one or more demand schedules; an output for transmitting by
the computer system on behalf of the expert service provider the
one or more demand schedules to a manufacturer/original source of
the product; an optimization engine for receiving product
availability information via the input of the computer system from
the manufacturer/original source of the product, and for
determining one or more options for ordering the products by the
computer processor of the computer system; a procurement system
implemented by the expert service provider on the computer
processor of the computer system for providing the product
availability information and the one or more options for ordering
the products to the plurality of end users on behalf of the buying
group, for ordering product by the one or more end users from the
manufacturer/original source of the product in accordance with the
procurement system, and for managing shipping the product from the
manufacturer/original source of the product to one or more of the
plurality of end users by the expert service provider in accordance
with the received product order information for each of the end
users.
31. The single ERP system of claim 30, wherein the output for
transmitting the one or more demand schedules also transmits the
one or more demand schedules to a one or more logistics and
fulfillment providers for one or more of the plurality of end users
by the expert service provider if it is determined that a product
order for the one or more of the plurality of end users is less
than a predetermined amount.
32. The single ERP system of claim 31, wherein the procurement
system generates the one or more orders in place of the one or more
product orders from the one or more of the plurality of end users,
resulting in automatic ordering therefore, thus creating a
perpetual inventory system between the one or more plurality of
individual end users and the one or more logistics providers and
manufacturer/original source of the product.
33. A non-transitory computer readable storage medium having a
computer program stored thereon, the computer program causing a
general purpose computer to perform a method for providing a supply
chain as a service, comprising the steps of: aggregating specific
demand for products and services from multiple individual entities
by a buying group to reach one of a desired volume and frequency
level; transmitting the accumulated aggregated product and services
demand by an expert service provider on behalf of the buying group
to a manufacturer/original source of the product and service;
receiving product and service availability information by the
expert service provider on behalf of the buying group based upon
the accumulated predictive product and service demand from the
manufacturer/original source of the product and service; providing
the product and service availability information to the plurality
of individual entities by the expert service provider on behalf of
the buying group; receiving one or more product and service orders
from one or more of the plurality of individual entities by the
buying group; ordering product and services by the expert service
provider on behalf of the buying group from the
manufacturer/original source of the product and services in
accordance with the received one or more product and services
orders, thereby disintermediating the supply chain and allowing for
procurement of product and services directly from manufacturers and
original sources of products and services; and shipping the product
and service directly from the manufacturer/original source of the
product and service to one or more of the plurality of individual
entities in accordance with the received product and service order
information for each of the end users for each of the plurality of
individual entities if it is determined that the product and
service order therefore are greater than a predetermined
amount.
34. The method of claim 33, wherein demand is combined from
individual entities with common demand requirements in multiple
industries by the expert service provider on behalf of the buying
group to reach one of a desired volume and frequency level in order
to disintermediate the supply chain.
35. The method of claim 33, further comprising the steps of:
transmitting the accumulated product and service demand to a one or
more logistics and fulfillment providers by the expert service
provider on behalf of the buying group for one or more of the
plurality of individual entities if it is determined that a product
order for the one or more of the plurality of individual entities
is less than a predetermined amount; receiving logistics
information from the logistics and fulfillment provider by the
expert service provider on behalf of the buying group; providing
the product and service availability information together with the
logistics information by the expert service provider to the
plurality of individual entities; receiving one or more product and
service orders from one or more of the plurality of individual
entities by the expert service provider on behalf of the buying
group; ordering logistics services by the expert service provider
on behalf of the buying group from the one or more logistics and
fulfillment providers in accordance with the received one or more
product and service orders for one or more of the plurality of
individual entities if it is determined that a product order for
the one or more of the plurality of individual entities and final
purchasers is less than a predetermined amount; shipping the
product and service from the manufacturer/original source of the
product and service to one or more of the plurality of individual
entities via the one or more logistics providers in accordance with
the received product and service order information for each of the
one or more of the plurality of individual entities if it is
determined that a product order for the one or more of the
plurality of individual entities and final purchasers is less than
a predetermined amount.
36. The method of claim 35, further comprising the steps of:
receiving by the expert service provider on behalf of the buying
group one or more individual entity requirements related to
delivery of the product and service; and providing a most cost
efficient method of logistics in accordance with the received end
user requirements.
37. The method of claim 36, wherein the one or more end user
requirements is selected from the group of cost, quality and
time.
38. The method of claim 35, further comprising the steps of:
receiving by the expert service provider on behalf of the buying
group one or more individual entity requirements related to the
product; and providing by the expert service provider on behalf of
the buying group a most cost efficient method of procuring the
product from the manufacturer/original source of the product in
accordance with the received individual entity requirements.
39. The method of claim 35, wherein the one or more individual
entities are grouped in the buying group for the purpose of
procuring products and services as negotiated by the expert service
provider from a plurality of providers over an extended period of
time.
40. The method of claim 35, wherein the buying group is provided
for the benefit of the plurality of individual entities.
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
efficiency can be seen during the continuing escalation of costs
from 2005-2010 coupled with the financial meltdown of late
2007-2009. This poor economic period created a tremendous demand
for efficiency in many businesses. Efficiency, in this case, is
meant, "to provide the same or greater quality of products and
services at a lower cost to the enterprise, therefore stabilizing
or diminishing the cost to their constituency (for example,
consumer, student, guest, member, patron, patient, clients,
citizen, taxpayer, etc.)." By diminishing the cost of products and
services that enterprises utilize and configure to satisfy the
demands of their paying constituencies, enterprises, comprising any
entity that may purchase goods or services to convert into another
product or service to be delivered to a constituent, and may
include institutions, businesses, governments and the like, may
offer higher quality products and services at a lower cost to their
constituencies.
[0004] In the United States, by way of example only, the
Hospitality (clubs, hotels, resorts, cruise lines, etc.), Education
(Universities, Colleges, and other educational facilities, public
and private), HealthCare (Hospitals, Nursing Home, senior assisted
living, etc.), and Banking and Financial industries including Banks
such as; Bank of America, Citigroup, JP Morgan/Chase, UBS, etc.
financial institutions such as; Blackstone, KKR, Apollo, Greenhill
and Co., etc: including cooperatives of commercial building
tenants, a block of commercial building tenants, blocks of
commercial building tenants, a metropolitan area of tenants, a city
of tenants and even a country of tenants, etc. . . . )
conservatively procure a combined $3.2 trillion of products and
services each year. These industries are comprised of tens of
thousands of enterprises that consume finished goods and services
in order to in turn provide their product or service to their
constituencies. These goods and services comprise the crucial
components necessary for the various operations (enterprises) to
execute their respective businesses and satisfy the needs of their
constituencies
(guests/patrons/members/students/patients/clients/etc. . . . ). The
products and services that the enterprises procure can range from
as little as 5%-75% or more of the operation's gross receipts. Any
other industries may have similar product and procurement costs,
and may similarly benefit from the various embodiments of the
invention.
[0005] Mitigating operational, product, and service costs is a core
objective in depressed and booming economies alike. There has
always been pressure on management to lower costs while still
maintaining the same level of quality. While this is especially
heightened during difficult financial times such as our current
economic environment, this pressure on management does not
dissipate when the economy is robust. The financial meltdown of
late 2007-present (effectuating record declines in revenues,
endowment funds, state funding, government funding, and assistance,
and rising medical costs, etc. . . . ), coupled with rising
operating costs, has put immense pressure on industries' management
to restructure forecasts, budgets, etc. Challenges to operators
have not been limited strictly to financial pressure. The last
decade has forged a socio-economic transformation from a
convergence of economic and behavioral changes of guests, patrons,
members, students, clients, taxpayers, and patients, etc., who are
more demanding than ever. This value conscience transformation is
expected to continue into the foreseeable future.
[0006] Operators of individual enterprises. communities,
municipalities, cities, states, nations, governments, etc. may be
limited in their ways of mitigating costs, and many reductions in
costs 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 (or taxes, levies) challenges its
value propositions and can cause a decline, discontinuation of use,
disgruntled constituencies, and possibly even social unrest.
[0007] The best way to reduce costs is to maintain or improve the
quality of products and services that an enterprise procures, but
at lower prices to the operator, government, etc. Several factors
currently prevent single (or even multi-unit) industries'
enterprises from achieving true and sustainable savings in
procurement costs and quality of purchases. 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 infrastructure and distribution costs that are
unavoidable to the end users (e.g. hotels, clubs, resorts, cruise
lines, hospitals, colleges and universities, banks and financial
institutions, and even governments) under the current systems.
[0008] It would be therefore beneficial to provide an improved
method and system that allows for the delivery and procurement of
such goods and services in an efficient manner, and that overcomes
the drawbacks of the prior art.
SUMMARY OF THE INVENTION
[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 3.sup.rd 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).
[0010] 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.
Another methodology deployed by some enterprises involves reducing
the quality of goods and services that they procure to attempt to
satisfy their demanding cliental. 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.
[0011] The best way to reduce costs is to maintain or improve the
quality of products and services that an enterprise procures, but
at lower prices to the operator, enterprise, or government. Several
factors currently prevent single (or even multi-unit) industries'
enterprises, communities, states or other governmental entities
(collectively "entities"), or any entity that purchases good and/or
services in order to provide their final product to their
constituencies from achieving true and sustainable savings in
procurement costs and quality of purchases. 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.
[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 3.sup.rd 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.
[0015] Still other objects and advantages of the invention will in
part be obvious and will in part be apparent from the specification
and drawings.
BRIEF DESCRIPTION OF THE DRAWINGS
[0016] For a more complete understanding of the invention,
reference is made to the following description and accompanying
drawings, in which:
[0017] FIG. 1 is a flowchart diagram depicting a flow of
information and goods and services in accordance with an embodiment
of the procurement system in accordance with the invention;
[0018] FIG. 2 is a block diagram depicting the details of one or
more independent end users in accordance with one or more
embodiments of the invention;
[0019] FIG. 3 is a block diagram depicting the details of one or
more cooperative buying groups in accordance with an embodiment of
the invention;
[0020] FIG. 4 is a block diagram depicting the business
functionality details of one or more manufacturers/original sources
of products and services in accordance with an embodiment of the
invention;
[0021] FIG. 5 is a block diagram depicting the details of one or
more 3.sup.rd party fulfillment/logistics entities in accordance
with an embodiment of the invention;
[0022] FIG. 6 is a flowchart diagram depicting an example of a
current supply chain;
[0023] FIG. 7 is a flowchart diagram depicting an example of an
alternative supply chain that may be implemented in accordance with
one or more embodiments of the invention;
[0024] FIG. 8 is a flowchart diagram depicting functionality of a
predictive engine in accordance with an embodiment of the
invention; and
[0025] FIG. 9 is a flowchart diagram depicting functionality of an
optimization engine in accordance with an embodiment of the
invention.
DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS
[0026] The invention will now be described making reference to the
following drawings in which like reference numbers denote like
structure or steps. FIG. 1 depicts a high level view of the flow of
information and goods (and/or services) resulting from the use of a
consolidated single ERP encompassing from end user consumption to
logistical needs through to manufacturer and original sources of
products and services, a seamless information and procurement
system and all its benefits in accordance with an embodiment of the
invention. As is shown in FIG. 1, one or more end user enterprises
1000 provide past and current needs for one or more goods and
services (consumption history). This information preferably spans
retroactively for three or more years, but may span any desirable
time period. This information is preferably consolidated at a
cooperative buying level 1010 for all end user enterprises 1000
associated with the particular buying cooperative. Such a buying
cooperative may comprise a plurality of end user enterprises 1000
from a single industry, or may alternatively comprise a number of
end user enterprises 1000 from multiple industries.
[0027] For products purchased in large quantities by end user
enterprises associated with a particular industry (such as the
estimated 20% of products that typically make up 80% of expense for
such end users) it is contemplated in accordance with an embodiment
of the invention, that industry specific buying cooperatives may be
formed. Additionally, because products purchased in lesser
quantities or of lesser value (such as the estimated 80% of
products that typically make up 20% of the expense for such end
users) may not provide sufficient economies of scale among entities
of a single industry, it is contemplated in accordance with an
embodiment of the invention, that cross-industry buying
cooperatives may be formed in order to cooperatively purchase these
goods and services.
[0028] In either event, such consolidated demand information may be
provided from cooperative buying group 1010 as singular and
aggregate enterprise consumption behavior, to a predictive engine
1020, which employs the accumulated demand information to predict
product, services and 3.sup.rd party logistics demand for
particular products and services over time by the consolidated
cooperative buying group 1010. Once this future and present demand
has been predicted, this information is then preferably provided to
an original source of goods and services 1040, and may also be
provided to a 3.sup.rd party logistics provider 1030.
[0029] After receipt of such predictive demand information by the
original source of goods and services 1040 and 3.sup.rd party
logistics provider 1030, each such entity may provide production
and delivery pricing and scheduling (such as lead time, bulk order
information, etc.) to an optimization engine 1050. The optimization
engine may provide various ordering possibilities to a procurement
system 1060, which in turn preferably presents this information to
the one or more end users 1000 associated with the cooperative
buying group 1010. This information is preferably provided via an
industry specific website, multi-industry website, or other
information provision system, and allows for individual ordering by
each end user entity 1000 in accordance with the provided pricing
and availability information. Various suggestive and other
optimization processes may be employed, as described in accordance
with the optimization engine, below.
[0030] As is further shown in FIG. 1, each end user entity 1000 may
order desired good and services through procurement system 1060
maintained in accordance with cooperative buying group 1010.
Preferably, members of a particular cooperative buying group are
located in some predefined geographic proximity to allow for
efficiency in product and service delivery, but any geographic
location(s) may be employed. This individual procurement
information may then be forwarded to both 3.sup.rd party logistics
provider 1030 and original sources of goods and services 1040 from
procurement system 1060 as particular orders for those goods and
services, and for associated 3.sup.rd party logistics needs. Any
need for the inclusion or level of participation of these 3.sup.rd
party logistics providers will be determined as described in
greater detail below. The individual procurement information may
further be provided to optimization engine 1050 in order to update
the various information provided thereby. This updated information
may then be employed in order to update the procurement system to
allow one or more end users 1000 to make optimum cost saving
decisions about purchase and delivery (i.e. date, time, quantity,
etc.) of available goods and/or services.
[0031] After such ordering, the original source of the goods and
services 1040 preferably produces or otherwise supplies these goods
and service, and delivers these goods and services to either one or
more end users 1000 directly, or to a 3.sup.rd party logistics
provider 1030 for breaking bulk shipments, and further forwarding
these smaller shipments to the one or more end users 1000.
International orders may require additional steps, such as overseas
shipping etc. It is contemplated that the above-described delivery
may comprise a complete shipping and fulfillment process, or
alternatively, may comprise a final shipping step or steps in what
may be a short or longer logistics process dependent upon specific
additional needs that may be present when global manufacturers or
original sources of goods and service are employed.
[0032] Referring next to FIG. 8, a flow of information to and from
predictive engine 1020 will now be described. As is shown in FIG.
8, at step 810 the predictive engine (1020 in FIG. 1) receive past,
present and future product needs from one or more cooperative
buying groups 1010. Then at step 820, this accumulated predictive
(present and future) information is preferably forwarded to
manufacturers or original sources of goods and services 1040 and
3.sup.rd party logistics providers 1030, allowing them to provide
(present and future) information regarding product and logistics
availability and pricing. Once the overall procurement system is in
use, as one or more end users 1000 and cooperative buying groups
1010 purchase goods and/or services, this procurement information
is provided to the predictive engine at step 830, allowing an
update thereof. Similarly, at step 840, any expected changes in
consumption behavior needs for one or more end users 1000 is
reported to the predictive engine, similarly allowing for the
update to any predictive information provided therefrom. This
updated information is then provided back to the manufacturers or
original sources of goods and services and 3.sup.rd party logistics
providers at step 850, and the processing returns to step 820. In
this manner, predictive information upon which manufacturers or
original sources of goods and services and 3.sup.rd party logistics
providers make production, availability, pricing and other
decisions may always be the most current information.
[0033] Referring next additionally to FIG. 9, a flow of information
to and from optimization engine 1050 is shown. As is shown in FIG.
9, optimization engine 1050 receives product information,
availability and pricing from manufacturers or original sources of
goods and services at step 910, receives logistics information,
availability and pricing from 3.sup.rd party logistics providers at
step 920, receives past, present and future consumption information
from the predictive engine at step 930, and receives procurement
information from the procurement system 1060 at step 940. At step
950 this information is processed by the optimization engine 1050.
Then at step 960, this optimized product availability, price and
other attributes are preferably forwarded to procurement system
1060 for use by the independent end users 1000 to maximize
efficiency of ordering. In this manner, end users 1000 are always
presented with the most up to date information regarding product,
service availability and choices to optimize cost savings.
[0034] Each aspect of the data and product will now be described in
greater detail. Referring next to FIG. 2, details associated with
the preferred transfer of past, current and future needs for one or
more goods and services from the one or more end users 1000 to
cooperative buying group 1010 will be described. Each individual
end user 1000 may include one or more ERP modules. Those shown may
include an accumulation of past, present and estimated or actual
future product needs 1001, an accounting system 1002, and one or
more procurement functions 1003. Of course, additional individual
modules may also be employed as desired and as may be appropriate
for each individual end user, such as inventory management, sales
organization and the like. For one or more end users may not
include electronically stored information. In such a situation,
information may be manually accumulated, through the review of
paper or other non-electronic records related to past purchases,
and past and present demand and sales or other figures.
[0035] It is anticipated in accordance with one or more embodiments
of the invention, that information from each individual end user be
accumulated in accordance with the one or more cooperative buying
groups 1010, as noted above. As is shown in FIG. 3, past and
present and future product use 1001 (FIG. 2) from each individual
end user 1000 are preferably provided to one or more of cooperative
buying group 1010 modules 1011, 1012. As noted above, for products
purchased in large quantities by end user enterprises associated
with a particular industry (such as the estimated 20% of products
that typically make up 80% of expense/spend for such end users),
such information may be provided to module 1011. As further noted
above, because products purchased in lesser quantities, or of
lesser cost (such as the estimated 80% of products that typically
make up 20% of the expense/spend for such end users) may not rise
to the level needed to reduce costs in production and/or delivery,
it is contemplated in accordance with an embodiment of the
invention, that multi-industry information may be provided to
module 1012. It should be noted that each individual cooperative
buying group 1010 may be formed as an industry-specific cooperative
buying group, thus including only module 1011, and not module 1012,
or as a multi-industry cooperative buying group, and thus including
module 1012 and not module 1011, or as a single cooperative buying
group including both modules 1011 and 1012, possibly consolidating
activities for multiple industries. In such a scenario, multiple
modules 1011 may be provided for each industry, and a single module
1012 for the purchase of cross-industry goods and services among
the industries included in the cooperative buying group 1010.
[0036] Such past, present and future consumption behavior for the
consumption of goods and services for all end users 1000 associated
with a particular cooperative buying group 1010 are accumulated at
the particular modules 1011 or 1012 as appropriate. As noted in
FIG. 1, this information is then forwarded to predictive engine
1020 in order to predict product and/or services and 3.sup.rd party
logistics demand (where required) for particular products over time
by the consolidated cooperative buying group 1010. Of course, such
predictive demand information may be determined for multiple
cooperative buying groups. Once this future and present demand has
been predicted, this information is then preferably provided to an
original source of goods and services 1040, and may also be
provided to a 3.sup.rd party logistics provider 1030
[0037] It is contemplated in accordance with embodiments of the
invention that such a system may evolve into a perpetual inventory
system ("Just in Time"), and perpetual ERP between manufactures and
original sources of goods and services, 3rd party logistics and
fulfillment providers and individual end user entities. Known
upcoming demand and expected and actual tracked changes in stock
levels at a particular end user or users are automatically
addressed. The manufacturers and original sources of goods and
services preferably produce and provide these goods and services,
3rd party logistics and fulfillment perform their required
execution proactively in response to accurate, predicted and actual
changes in stock levels and response requirements, rather than
retroactively to specific orders for those goods or services by
individual end users and their cooperatives.
[0038] Referring next to FIG. 4, details associated with one or
more original sources of goods and services 1040 will be described.
As is shown in FIG. 4, such manufacturers may include all
intermediate processes required for the production and integration
of product's components. Such manufacturing may comprise the use of
machines, tools or labor to produce final (finished) goods for user
or sale. Each such manufacturer or original source of goods and
services (defined as the last leg of value creation of finished
goods) typically employ an Enterprise Resource Planning (ERP) tool
that may be enterprise or conglomerate specific. For such a
manufacturer or original source of goods and services 1040, such an
ERP may include any number of modules, such as business
intelligence 1041, manufacturing resource processing 1042,
group-ware communications 1043, human resources 1044, inventory
control 1045, shipping 1046, accounting 1047 and sales 1048, by way
of example only. Additional modules may be included as desired by
the individual entity, or different functionality may be provided
for use by certain manufacturers or original sources of goods.
[0039] Thus, predictive demand information provided from predictive
engine 1020 is preferably provided to one or more modules of the
ERP system of the appropriate manufacturer or original source of
goods and services 1040, including one or more of business
intelligence 1041, manufacturing resource processing 1042,
group-ware communications 1043, human resources 1044, inventory
control 1045, shipping 1046, and sales 1048. This information is
preferably employed by manufacturer or original source of goods and
services 1040 in order to adjust one or more elements of their
operation in order to be able to provide made to order product
manufacturing and delivery. By knowing predictive demand
information, each module of the ERP system of the manufacturer or
original source of goods and services 1040 may be employed to
prepare for upcoming demand and enjoy all of the benefits of
knowing what the future demand may bring. The advantages to
manufacturers or original sources of goods and services 1040
affords extreme efficiency for this sector of commerce such as
definitive knowledge of producing products and services for today
and the future when they are to be utilized by individual end users
1000, resulting in the sector of commerce converting to the
ultimate efficiency of "Made to Order" or "Just in Time". This
extreme advantage allows; better manufacturing capacity
utilization, more efficient raw material procurement, better human
resource requirement management, advantageous cash flow and
requirement planning, improved ability for planning and purchasing
energy needs, beneficial capital asset management, improved sales
and marketing, including rational planning related to revenues and
expenses, reduction in just in time inventory costs, etc. . . . .
Knowing the future brings the ultimate economic and structural
advantages to the commerce sector 1040 manufacturers and original
sources of products and services.
[0040] Referring also to FIG. 5, each 3.sup.rd party logistics and
fulfillment entity 1030 may similarly include an ERP system that
may be enterprise or conglomerate specific, and may further include
one or more modules customized for this or multiple fulfillment
type entities. Thus modules such as work in process 1031, advanced
shipping notices 1032, a demand flow scheduling system 1033, a
supply chain sustainability module 1034, a warehouse management
system 1035, supply chain management 1036, accounting 1037 and
sales 1038 may be provided. Predictive demand information from
predictive engine 1020 is preferably provided to one or more
modules, such as work in process 1031, advanced shipping notices
1032, a demand flow scheduling system 1033, a supply chain
sustainability module 1034, a warehouse management system 1035, and
sales 1038. This information is preferably employed by 3.sup.rd
party logistics provider 1030 in order to adjust one or more
elements of their operation in order to be able to provide "Made to
Order" logistics and fulfillment, or "Just In Time" delivery and
other logistical support. By knowing predictive demand information,
each module of the ERP system of the 3.sup.rd party logistics
provider may be employed to prepare for upcoming demand and enjoy
all the benefits of knowing what the future demand brings. The
financial advantages of known actual future demand that the "Made
to Order" or "Just in Time" business process, described here,
results in the ultimate efficiency for the commerce sector 1030 3rd
Party Logistics and Fulfillment. While prior art systems have
allowed for the passage of information from retailer to upstream
product/manufacturer or logistics provider, for example, no such
prior art system has allowed for the complete integration of the
supply chain, from individual end user to manufacturers/producers
or original sources of goods and services, and 3.sup.rd party
logistics providers. Allowing for the use of past, present and
predictive future demand from the individual end users,
manufacturers/producers or original sources of goods and services
and 3.sup.rd party logistics providers are able to operate in a
just in time or made to order manner. Their operations may be based
upon actual and predictive consumption patterns in accordance with
consumption data retrieved from the individual end users,
industry-specific enterprises and multi-industry aggregation of
enterprises.
[0041] Once manufacturers or original sources of goods and services
1040 and 3.sup.rd party logistics providers 1030 have received and
processed this predictive demand information based upon present and
future consumption patterns, preferably making the above-noted
adjustments in their own processing, they are able to provide
supply, delivery and present and future pricing information to
optimization engine 1050. It is anticipated that such supply,
delivery and pricing information will be on very beneficial terms
for end users 1000, as relative certainty in demand allows for the
manufacture of/for precisely the correct amount of goods, or
provision of the correct amount of services. There is no need for
production or provision of excess capacity. Furthermore, as noted
above, removal of various intermediary levels of distribution not
only reduces the cost of storage of such goods, inventory and the
removal of the redundant infrastructure and occupancy costs at each
such intermediary level, but also improves the quality of the
predictive demand information, thus allowing the manufacturers or
original sources of goods and services 1040 and 3.sup.rd party
logistics providers 1030 to be more confident in this predictive
data, allowing for more precise tuning of production and delivery
schedules. This reduction resulting from efficient inventory
controls and the other improved aspects of the described process
contributes to an overall savings to users throughout the ordering
and delivery system, a cost savings ultimately passed on to end
users 1000.
[0042] As described above with respect to FIG. 9, optimization
engine 1050 collects information from manufacturers or original
source of goods and services 1040, 3.sup.rd party logistics
providers 1030, past, present and future consumption information
from the predictive engine 1020, and procurement information from
the procurement system 1060 so that individual enterprises, through
their associated cooperative buying groups (either industry
specific or multi-industry) can purchase goods and services as
desired, maximizing the cost reduction benefits of lowest price for
desired products and services. By maximizing timing of volume
requirements, by aggregating other individual enterprises
consumption requirements for required products and services, and by
advising the ordering enterprise end user how to maximize their
cost savings for product and service acquisition and logistics,
individual enterprises within specific geographic areas of demand
are able to disintermediate the supply chain and receive goods and
services at the lowest total cost. By accurately predicting
manufacturers or original sources of goods and services capacity,
availability of goods and services in light of enterprises and
co-operative demands, manufacturers and original sources of goods
and services and 3.sup.rd party logistics providers may make
available the lowest price possible for desired products and
services for the end user individual enterprises, through the
cooperative buying groups. The optimization engine thus also
maximizes cost reductions for the 3.sup.rd party logistical
functionality to distribute and fulfill the goods and services
purchased direct from the manufacturers or sources of goods and
services to the individual enterprises that comprise the
cooperative buying groups based on the timing, capacity
availability, routing options and costs, and quality control of
logistics to satisfy the individual end users' needs of timing,
quality control, and cost effectiveness. The optimization engine
may act to assist the procurement system to in turn function as an
automated procurement and ordering tool as end users deploy and
practice a functional "single ERP system" execution of perpetual
inventory between end users, manufacturers or original sources of
goods and services, and 3.sup.rd party logistics suppliers. Such a
shift will result in manufacturers or original sources of goods and
services and 3.sup.rd party logistics providers transforming into
"made-to-order" and/or "Just in Time" industries.
[0043] If manufacturers and original sources of goods and services
1040 shift from "made-to-stock" to "made-to-order" (Just in Time,
"JIT"), then the expended resources of inventory at the
manufacturer level and the redundant cost of inventory levels
through different levels of the supply chain may be eliminated.
"Made-to-order" also allows the manufacturer and original source of
products and services to plan their future utilization of
manufacturing capacity (capacity planning, work in progress "WIP",
etc.), raw material utilization, HR needs, marketing requirements,
energy utilization, cash and capital requirements, and many other
factors in a much more efficient mechanism that result in
tremendous efficiency and cost savings. Similarly, 3.sup.rd party
logistics providers 1030 will benefit by knowing demand for the
future (instead of guessing). This will allow 3.sup.rd party
logistics providers 1030 to be more efficient in knowing what
their; capacity utilization of work in process "WIP", advance
shipping notice "ASN", demand flow scheduling, supply chain
sustainability, warehouse management "WMS", supply chain
management, facility and asset utilization, energy utilization and
cost, marketing, cash flow, HR needs, and capital expenditures.
This knowledge and the efficiencies it creates result in tremendous
cost savings for 3.sup.rd party logistics providers. The result of
the capability for manufacturers and original sources and 3.sup.rd
party logistics providers to be able to change their model from
"made-to-stock" to "made-to-order" (JIT) results in tremendous cost
savings and efficiencies for: end user individual enterprises; the
co-operatives; 3.sup.rd party logistics providers; and
manufacturers and original sources of products and services,
alike.
[0044] As noted above with respect to FIG. 9, optimization engine
1050 receives all such availability, scheduling and delivery
information from manufacturers or original sources of goods 1040
and 3.sup.rd party logistics providers 1030, past, present and
future consumption information from the predictive engine 1020, and
procurement information from the procurement system 1060, and
accumulates this information in order to provide real time pricing
and delivery information to end users, through procurement system
1060, including modules 1003 and 1014, maintained in accordance
with each cooperative buying group 1010. Thus, as is shown in FIG.
3, procurement module 1014 for each cooperative buying group 1010
may be consolidated into a single or multiple procurement systems
1060. Similarly, each end user 1000 includes a procurement system
1003, allowing for procurement of materials from each cooperative
buying group procurement module 1014, via procurement system 1060.
The procurement system for each such end user may preferably
combine procurement options for all cooperative buying groups to
which the end user belongs, or may comprise a separate procurement
system for each.
[0045] It is further contemplated in accordance with an embodiment
that the various procurement options may be presented to each end
user 1000 via one or more procurement websites made available to
each individual end user 1000 for each cooperative 1010, or in a
consolidated manner. This procurement information, as noted above,
may be determined from not only previously presented historical
data to determine future needs, but may also include present orders
provided to predictive engine 1020 from procurement system 1060,
forwarded to manufacturers or sources of goods and services 1040
and 3.sup.rd party logistics providers (and fulfillment) 1030, and
ultimately updated and returned to the procurement module via
optimization engine 1050. Through the procurement system associated
with each cooperative buying group, each individual end user is
able to make determinations about when to purchase product, how
much product to purchase, and how and when it will delivered to
each end user.
[0046] Each such website may be provided as an industry-specific
(and/or multi-industry) website to each end user entity 1000, with
various functionality related to order execution, pricing,
logistics (time and delivery, cost for 3.sup.rd party logistics, as
applicable), accounts payable, order history, pricing history and
peer to peer communications, as well as communications from any end
user 1000 to other entities, such as managers of one or more
cooperative buying groups 1010, manufacturers or original source of
goods and services 1040, 3.sup.rd party logistics providers 1030,
customer support (CRM, client relations management) and the like.
Further communications platforms may be provided between
manufactures or original sources of goods and services 1040 and end
users 1000 where new information on products is available, thus
allowing for a most up to date searching on product specifications,
and other product information, and services. Such a platform and
channel may also allow for one or more important announcements to
be made unobtrusively, and made available to any end user who
wishes to view the information. An order screen may be provided so
that end users may have detailed information to order items that
are specific to their industry, and in particular the approximately
20% of product, (or stock keeping unit (sku#s), each indicative of
a different good or service including particular specifications)
that typically makes up approximately 80% of their spend on
purchases (for industry-specific cooperative buying groups), of for
the approximately 80% of product (or sku#s) that typically makes up
approximately 20% of their spend on purchases (for
cross/multi-industry cooperative buying groups). Products being
provided in each such scenario may be determined in accordance with
one or more of volume per order, frequency of orders, total annual
ranking of spend per product, and the like. The sku#s and other
product information may be provided to one or more of the
procurement websites including information on price, minimum order
quantities, 3.sup.rd party logistics costs (where applicable),
etc.
[0047] The use of such a website or intranet will thus allow for
the accumulation of orders and other information transfer from each
individual end user 1000, via optimization engine 1050 and
procurement system 1060, to the corresponding cooperative buying
group 1010. Furthermore, order quantities from different
cooperatives may be combined to meet minimum order quantities as
appropriate, or to otherwise further reduce costs. Once properly
accumulated, procurement system 1060 preferably will order the
goods from the manufacturers, and set delivery schedules taking
production and shipping timetables, etc. as will be described
below. In such a manner, individual end users are presented with an
easy to use, cost effective and transparent product and service
ordering system.
[0048] A minimum order quantity may be related to an order amount
necessary for a particular product to fill a delivery unit in a
particular geographic area, so that as noted above, direct delivery
may be available. Such direct delivery may result in reduced cost
for the end user ordering the substantial quantity of goods as
direct delivery from the manufacturer or original source of goods
1040 to the end user 1000, as will be described below. Procurement
system 1060, in accordance with optimization engine 1050 may
provide information to an end user 1000 regarding opportune times
to order and/or have goods delivered. For example, if a large
quantity of a particular good is to be delivered to a particular
geographic region on a day next week, attempts to order delivery of
such a good this week may result in notification of a price
reduction that may be available by waiting for delivery of goods
until the next week. End user 1000 may then select to wait for the
less expensive shipment, or opt to order the more expensive, but
earlier delivered goods if time is important. Such advice may also
be provided to one or more end users 1000 when optimization engine
suggests ordering a particular good at a particular time to fill a
production run or delivery unit when combined with expected order
sizes from other end users in the same cooperative.
[0049] If the end user wishes to order a smaller amount than the
direct delivery minimum order quantity, and cannot take advantage
of any combined ordering, price adjustments are preferably made to
account for needed 3.sup.rd party logistics provider 1030. If at a
later time, other cooperative end users request similar products
eventually resulting in the minimum order quantity being reached,
associated pricing savings based upon the delivery of the minimum
order quantity to the geographic location may be provided. Such
advice provided to one or more end users 1000 may be based upon a
combination of actual orders presented via procurement system 1060
and input from predictive engine 1020 related to past behavior and
further likely orders of goods and services, this information being
updated with current info from the procurement system and
optimization engine for individual enterprises and various
cooperative buying groups.
[0050] In accordance with further embodiments of the invention, as
an end user 1000 enters information into the system to select and
order goods or services, the procurement system, employing the
optimization engine, may review these order amounts to determine
whether these orders are outside a normal range of ordered product
for that particular end user, and may notify the user of any such
unexpected order quantity to guard against ordering errors. If
these orders are correct, this change in order quantity will flow
through the system, via procurement system 1060, eventually
notifying the supplier and shipping entities of this increase or
decrease in demand (consumption change) via the update of the
predictive engine 1020.
[0051] As a particular end user orders goods and services,
accumulated costs will be provided to the end user in a transparent
manner, including cost per purchase, cost per particular item or
sku#, 3.sup.rd party logistics costs, any cost for administration
of the cooperative buying group, etc. If at any time, the above
noted bulk shipping option is met or other cost savings may be
realized through aggregation of other individual enterprises 1000
wanting the same products and services at relatively the same time,
and therefore costs can be reduced, either because the single end
user can receive a single end shipping amount, or because other end
users have ordered similar goods to allow for a single shipment to
be delivered to a particular geographic location, thus avoiding any
charges for third party logistics or reducing them per delivery
point by aggregate for the day, such cost savings may be passed on
to the individual end users 1000. Any such orders will also include
end user delivery dates. To the extent that orders may be combined,
but still be maintained within a previously promised price and
delivery date, these orders may be combined. As noted above, if
such combination would push out a delivery date, the end user may
be given a choice of whether to receive the goods at the previously
provided 3.sup.rd party earlier delivery date, but likely a higher
cost, or at the later delivery date, made lower by logistics
efficiency by the behavior of other end users in the cooperative
buying groups into which the particular end user 1000 is included.
Alternatively, the system may be set to not allow for the extension
of a delivery date ever, or if the user indicates that delivery
timing is critical.
[0052] If changes by a manufacturer/original source in price,
specifications or the like are encountered, or if any changes in
the cost or other scheduling issues of 3.sup.rd party logistics
providers is necessary or provided by the logistics providers, such
information will be immediately conveyed to the end user, allowing
for confirmation of the new information for an order. The end user
may receive delivery, or may cancel, or change the order at this
time. Such information is also transmitted to the optimization
engine in near real time, thus allowing for this new pricing
information to be shared with all end users 1000 when purchasing
goods and services.
[0053] Referring once again back to FIG. 1, after ordering of goods
and services by end user 1000 through procurement module 1003 via
procurement system 1060, which incorporates one or more procurement
modules 1014 of one or more cooperative buying groups 1010,
accumulated and individual purchase order information may be
provided to manufacturer or original source of goods and services
1040 and third party logistics providers 1030 (where necessary) in
order to schedule production and delivery of the ordered goods and
services. Such information is provided from procurement module 1003
of end user 1000 (as shown in FIG. 2) to procurement module 1014 of
cooperative buying group 1010 (as shown in FIG. 3) to sales module
1048 of manufacturer or original source of goods 1040 to properly
place the order, and also to sales module 1038, advanced shipping
notice module 1032 and demand flow scheduling system 1033 of
3.sup.rd party logistics provider 1030 (when 3.sup.rd party
logistics is to be employed) in order to reserve 3.sup.rd party
logistics services. After such ordering is placed, accounting
information from accounting module 1047 is provided to accounting
module 1013 of cooperative buying group 1010, where it is in turn
split and provided to accounting module 1002 of each end user 1000.
A similar path is provided for accounting information from 3.sup.rd
party logistics provider 1030, the accounting information being
provided from module 1037 to the cooperative buying group
accounting module 1013, and in turn the end user accounting module
1002.
[0054] Alternatively, depending on who is to bear shipping and
other 3.sup.rd party logistics charges, such accounting information
may be provided from 3.sup.rd party logistics provider 1030 (and
associated accounting module 1037) to manufacturer or original
source of goods and services 1040 (and associated accounting module
1047). This accounting information may then be included with the
accounting information being sent from manufacturer or original
source of goods and services 1040 to cooperatives buying groups
1010 (and associated accounting modules 1013) and then to end user
1000 (and associated accounting modules 1002), as described
above.
[0055] Finally, the ordered goods may be shipped to the end users
1000. It is contemplated in accordance with one or more embodiments
of the invention that shipping of products to end users may
preferably follow one of two paths. If particular end users are to
receive greater than a certain amount of a particular product so
that a single shipping unit, such as a truck, can visit a small
number of end users with a full shipping unit (for example, if a
particular user has ordered more than 1/6 of a truckload, typically
four palettes or more of goods), then such a shipping unit may be
provided directly from a particular manufacturer or original source
of goods and services 1040 to each end users 1000. If, on the other
hand, a particular end user is to receive a smaller product
shipment, in addition to providing shipping services, one or more
3.sup.rd party logistics providers 1030 may receive a shipping unit
from one or more manufacturers or original sources of goods and
services 1040, break up the shipment, and ship to each end user
separately in small batches, possibly consolidated (through one or
more fulfillment processes) with any other sku#s that have been
ordered by the particular end user 1000. Thus, if a particular end
user is to receive a large amount of total product made up of small
amounts of different products, these different products may be
loaded to a single shipping unit, and then delivered in a bulk
fashion to the particular end user 1000 from the 3.sup.rd party
logistics provider 1030. Use of such a repackaging of shipping
units may follow a similar rule to the direct shipping system
described above. In this manner, a most efficient system for
shipping products to end users is employed, direct shipping when
efficient, grouping and intermediate handling of products when
appropriate, through intermediate fulfillment providers, such as
3.sup.rd party logistics providers. Finally, a portion of a
truckload or other shipping unit may be delivered directly to an
end user 1000 from a manufacturer or original source of goods and
services 1040, while the remaining portion of the shipping unit may
be forwarded to 3.sup.rd party logistics provider 1030.
[0056] Consolidation of all ERP information into a single, unified
system allows for organized and ultimate efficiency of
manufacturing based upon true consumer needs and consumption
behavior, managed and efficient shipping and delivery of products
to end users, consolidated order fulfillment and billing from
manufacturers to end users, and efficient use and management of
third party logistics systems when appropriate. It is only through
this inventive consolidated approach that multiple levels of
distribution may be removed from supply and procurement schemes,
providing a best price to an end user, while allowing producers to
have unparalleled view into customer needs and behavior, thus
allowing for production and supply of needed quantities of products
and services. Details of information provided by each entity in
FIG. 1, and the interrelationship therebetween will now be
described.
[0057] Cooperatives buying groups 1010 will therefore represent new
buying entities owned by the end users 1000 associated therewith
(or by another entity), for each of the individual independent end
users 1000, enabling these end users to disintermediate themselves
from the traditional supply chain. This new cooperative buying
group 1010 constitutes a new entity adapted to aggregate volume of
purchases to buy direct from manufacturer or original sources of
goods and services 1040. Through these cooperatives, individual end
users will reap the benefits of essentially dealing directly with
manufacturers and original sources of goods and services. It is
anticipated that the cooperative buying groups may take actual
title to procured goods, making final payment on behalf of the
individual end users 1000, and may then bill and interface with
each individual end user. Differences in timing for changes in
title may be provided to accommodate any customary goods transfer.
Of course, other scenarios, including provision of services to an
end user, where the cooperative buying group 1040 does not take
ownership of the products or services, and rather acts only as a
planning intermediary may also be employed. An overall accounting
management system may be provided, tracking accounts payable from
individual enterprises to the cooperatives and the cooperatives to
the manufacturers and original sources of goods and services, thus
not only allowing for efficient and managed ordering and
fulfillment, but also billing and all other aspects associated with
procurement of goods and services.
[0058] Past demand (consumption behavior) and/or current behavior
information may be provided to predictive engine 1020 in accordance
with past and/or current product and service needs by individual
end users 1000 and/or cooperative buying groups 1010. Of course,
expected weather changes, demand changes, usage changes, behavioral
changes, consumption changes, or any other factors that might
affect the amount of product or services necessary (such as, in the
case of a University, expansion of campus to allow additions to
student body and faculty, addition of a new concentration of
education, etc.), or any other significant changes in operation may
be accounted for, and thus adjust demand predicted by the
predictive engine. Thus, nearly all aspects related to product
manufacturing, service rendering, and supply may be determined not
only based upon historical guesses, but rather on particular past
consumption, current consumption and future demand information
provided by individual end users 1000 and their behavior.
[0059] Similarly, once amounts of products and services are
determined by end users 1000 and ordered by cooperative buying
groups 1010, such ordering information may be provided to
manufacturers or original sources of goods and services 1040 and
3.sup.rd party logistics providers 1030 (where needed), and in
particular, information may be provided directly into their ERP
system. In this manner, 3.sup.rd party logistics fulfillment
providers' entities are aware of upcoming shipment and fulfillment
needs even before notification by the manufacturers, and can then
best plan their needs moving forward. As noted above, shipping
information from the manufacturers or original sources of goods and
services 1040 for goods that may require additional 3.sup.rd party
logistics treatment may be provided directly to 3.sup.rd party
logistics providers 1030 into their supply chain management system
1036, as this information may not be available until actual
shipping quantities and dates are provided, and it is determined
that direct shipping of goods will not take place, but rather that
additional logistics and fulfillment activities may be necessary.
As further noted above, large enough shipments may be provided
directly to one or a small number of end users, thus perhaps
eliminating the use of the 3.sup.rd party logistics providers 1030,
and costs associated therewith, in some cases.
[0060] Cooperative buying groups 1010 may further receive
accounting information from each of manufacturers or original
sources of goods and services 1040 and 3.sup.rd party logistics
providers 1030, and may process and provide individual accounting
information to each end user 1000. Thus, cooperative buying groups
1010 mediate availability of product from manufacturers or original
sources of goods and services 1040, ordering from end users 1000,
delivery of products or services, directly to end users 1000, or
through the intermediate use of 3.sup.rd party logistics providers
1030, and facilitate easy and proper billing of the end users
1000.
[0061] Thus, in accordance with the various embodiments of the
invention, rather than each individual end user 1000 interfacing
with multiple levels of distribution for each product, a cohesive
system may be provided, allowing for end-user owned cooperatives to
procure products in an efficient managed and cohesive manner. It is
further contemplated in accordance with an embodiment of the
invention that an expert service provider may maintain the
underlying platform and channel, and by way of example, support the
collection of purchasing and usage information from end users 1000,
maintaining predictive engine 1020, providing information to
manufacturers and/or original sources of goods and services 1040
and 3.sup.rd party logistics providers 1030, maintaining
optimization engine 1050, and may be maintaining accounting 1014 at
the cooperative level and may even be maintaining accounting at the
individual end user 1003, procurement system 1060. As part of
service provided by the expert service provider, direct negotiation
with manufacturers or original sources of goods and services 1040
and 3.sup.rd party logistics providers 1030 will or may be
performed on behalf of each cooperative buying group 1010 and
individual enterprises 1000. This expert service provider may earn
a fee for its services, but it is anticipated in accordance with
the invention that the reductions in costs for supply and delivery
of goods and services will be substantially greater than such fee.
Expertise of the expert service provider, this invention of the
channel and platform (single ERP system), coupled with the
formation of new purchasing entities (cooperative buying groups
1010) will allow for a new supply chain to be employed,
disintermediating much of the currently existing supply chain, and
therefore shifting manufacturers or other sources of goods and
services, as well as 3.sup.rd party logistics and fulfillment
providers from "made to stock" entities to "made to order" and/or
"just in time" entities, and further allowing for 3.sup.rd party
logistics providers to become much more efficient in performance of
their services.
[0062] As will now be shown with particular examples, use of the
inventive system results in a more efficient overall supply chain,
and as a result substantial savings for end users, a reduction in
environmental impact of delivery and carbon footprint, and less
wasted produced product, thus aiding in avoiding over or under
supply of product, in turn reducing substantial unplanned price
swings and production shortages. The efficient planning by
manufacturers or original sources of goods and services and
3.sup.rd party logistics providers may remove substantial costs
from the production and delivery scheme. Efficiencies may be
further realized in the ability to more efficiently hedge energy
costs, properly employ necessary manpower, purchase raw materials
or other unfinished goods more efficiently, more efficiently deploy
capital, reduce accounts receivable cycle, thus reducing working
capital requirements, reducing inventory and inventory support
costs while also reducing future inventory write downs and other
obsolescence of inventory, by way of example.
[0063] As is next shown in FIG. 6, a current supply chain solution
is shown for the exemplary fertilizer industry. As is shown, a
source of fertilizer 610, such as a Canadian manufacturer or
original source of fertilizer, may charge a price of $100 for a 50
pound bag, or other appropriate amount of fertilizer. This supplier
has no idea of how much fertilizer may be required in the market,
only receiving information based upon its supply chain interaction
only with next lower level purchaser or inventory movement with the
next levels of supply chain, and so production amount is a guess,
and must be provided in order to support inventory carried at each
level of the supply chain, each of which is also a guess. This
fertilizer is then typically passed or sold to a North American
Distributor of Fertilizer 610, who similarly has no idea of how
much fertilizer will actually be needed this year or next by the
ultimate end user's current and next year's consumption. Therefore
this distributor must charge a premium to account for fertilizer it
will buy that may not be purchased buy the next level of
distribution, and to cover inventory costs, etc. for a presently
unknown period of time. This NA distributor typically applies a
markup of between 20 and 25% of the cost of the fertilizer to it,
so at this point, the price of the fertilizer has risen to $125.
Next, this fertilizer is passed or sold to a regional Northeast
distributor 620 (for example) that distributes fertilizer and other
related products. Again, this distributor has no insight into
fertilizer needs (by the end user at this point in time), and
therefore must again charge a premium to account for fertilizer it
will buy that may not be sold in the market, and that it must
inventory for an unknown period of time. This second distributor
may similarly apply a markup of 25% on products it handles, thus
raising the price of the fertilizer to $156.25. Elimination of the
multiple levels of distribution further reduces redundant;
inventory costs, occupancy costs, sales costs, costs of
amortization of facilities, handling and shipping, etc.
[0064] This fertilizer will similarly be passed or sold to a local
distributor 630 who may have relationships with the final
purchasers of this and any number of other items. These final
purchasers are typically organizations in the hospitality industry,
education, healthcare, and the like, but of course may be any
enterprise, government entity, etc. based upon the particular good.
Retail stores or any other purchasers may similarly comprise these
final purchasers. While this distributor may have some insight into
customer needs based upon direct interaction therewith, these would
be based upon anecdotal historical properties, and cannot account
for changes in demand, such as if the weather were particularly
harsh over the winter, if the price of goods become prohibitive, if
a customer has added area that needs to be fertilized, etc. The
local distributor may add as much as a further 35% to their cost of
the fertilizer, resulting in a cost to the final purchaser of
$210.60, more than double the initial payment to the fertilizer
manufacturer or original source of the goods. The inventors of the
present invention suggest that inefficiencies in both the number of
levels of distribution and their redundant costs that add no value,
in addition to the lack of knowledge about upcoming demand
(redundant inventory costs), contribute to these higher prices and
inefficient distribution of product. These inefficiencies result in
multiple occupancy of various levels of the supply chain, requiring
costly sales and marketing organizations, SG&A costs,
operational inefficiencies, excess capital costs, inefficient
energy utilization, more extensive carbon footprints, various
handling costs, and the like, each of which adds no value to the
products or supply chain, and in fact results in no change to the
finished product. It is therefore a benefit if the present
invention to remove all inefficient costs that do not add value to
the process or result in a change to the final product. In this
manner, only necessary costs related to the provision of the end
product, and efficient delivery of that product to end users are
incurred.
[0065] Referring next to FIG. 7, a new and more efficient supply
chain 700, employing the features of the invention described above
(a new channel and platform), may be achieved in accordance with
embodiments of the present invention. As is shown in FIG. 7,
Fertilizer supplier 710 still receives the same $100 for their
fertilizer. However, instead of employing various levels of
distribution, an inventive disintermediation entity 720 (such as a
group managing multiple cooperatives 1010) employs the combined ERP
system described above to remove the need for these intermediate
levels of distribution and storage, and accompanying costs
associated with distribution, storage, inventory, etc. as noted
above and is able to purchase precisely the correct and needed
amount of the product for use by the final customers, thus
providing substantial efficiencies in the process, while allowing
the manufacturer or original source of goods to become made to
order rather than made to stock. Because of the unique insight into
customer needs, there is virtually no wasted product produced or
purchased, redundant non value added costs are eliminated, and the
various made to order benefits, etc. are realized in the matter as
noted above. Because of the flat organization and lack of multiple
levels of distribution, common carriers can be used to distribute
product to end consumers directly from the fertilizer supplier. As
noted above, it is anticipated that for larger orders (such as less
than six final customers able to buy an entire truck load or other
distribution unit, for example), the distribution system will
transport product directly to these final customers from the
manufacturer or original source. In a situation where smaller
orders are needed, this material may be provided to a single
distribution center, where different products (such as fertilizer,
chemicals, maintenance supplies, construction materials, etc.) may
be combined and efficiently shipped in bulk to each individual
final customer. Or, these smaller lots may be individually
transmitted to the final customer employing one or more independent
shipping companies, or 3.sup.rd party logistics providers able to
break bulk product deliveries and make individual or consolidated
deliveries (in the case of multiple products being delivered to a
single end user). This scheme for direct shipping, or the use of a
single level of 3.sup.rd party logistics removes redundant,
non-value added costs of inventory, SG&A, occupancy costs, A/R,
A/P costs, etc.
[0066] Shipping of such goods may cost approximately 18% of the
initial supply cost of the product from the manufacturer or
original sources of goods and services, raising the cost of goods
to only $118. Furthermore, because of the precision ordering
available and the lack of waste, the organizing company organizing
these cooperatives 1010, and managing distribution, etc. can easily
function adding only 5% to the cost of goods, for a final cost to
the final customers of only $124, by way of example. Thus, the
final customer receives goods at a substantial discount, in an
easier to manage process. Less product is wasted, quantities are
well known ahead of time, and transportation is far more
efficient.
[0067] Referring once again back to FIG. 1, a computer system,
individually maintained, positioned in a cloud computing scenario,
or otherwise provided is preferably adopted to support all
functions of the invention. Thus, such a computer system preferably
includes input systems, comprising direct data input, or input
through the user of APIs or other methods for automatic data input.
Such data may be input to the system from any of the entities, such
as manufacturers/original sources, 3.sup.rd party logistics and
fulfillment entities and cooperatives, as noted above. Furthermore,
each cooperative buying group member or consolidated group may be
provided with a website or other online system allowing for
individual end users 1000 to enter any type of demand or other
information. Linking of ERP or other data systems from the
individual end users may allow for automated information
transmission. It is anticipated that such a computer system will
comprise one or more processor, storage devices, user access points
and data information input and output systems. Any known local or
remote computing system may be provided, and may further include
backup systems, redundant data storage and processing systems and
the like.
[0068] Various embodiments of the present invention may be embodied
in one or more of the following paragraphs.
[0069] A method for procuring a product, comprising the steps
of:
[0070] receiving information relating to past, present and future
product demand and consumption for each of a plurality of end users
in a predefined industry;
[0071] accumulating the received product demand into a single
predictive demand schedule by a cooperative buying group;
[0072] transmitting the accumulated predictive product demand
schedule to a manufacturer/original source of the product by the
cooperative buying group;
[0073] receiving product availability information based upon the
accumulated predictive product demand from the
manufacturer/original source of the product by the cooperative
buying group;
[0074] providing the product availability information to the
plurality of end users by the cooperative buying group;
[0075] providing the product availability information to the
plurality of end users by the cooperative buying group;
[0076] receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group;
[0077] ordering product from the manufacturer/original source of
the product in accordance with the received one or more product
orders by the cooperative buying group; and
[0078] shipping the product from the manufacturer/original source
of the product to one or more of the plurality of end users in
accordance with the received product order information for each of
the end users.
[0079] The method of paragraph 69, wherein the product is shipped
directly from the manufacturer/original source of the product to a
particular end user if the end user demands more than a
predetermined amount of product.
[0080] The method of paragraph 69, wherein the product is a
service.
[0081] The method of paragraph 69, further comprising the steps
of:
[0082] transmitting the accumulated product demand to a logistics
and fulfillment provider;
[0083] receiving logistics information from the logistics and
fulfillment provider;
[0084] providing the product availability information together with
the logistics information to the plurality of end users by the
cooperative buying group;
[0085] receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group;
[0086] ordering logistics services from the logistics and
fulfillment provider in accordance with the received one or more
product orders by the cooperative buying group;
[0087] shipping the product from the manufacturer/original source
of the product to one or more of the plurality of end users via the
logistics provider in accordance with the received product order
information for each of the end users.
[0088] The method of paragraph 72, wherein the step of accumulating
the received product demand into a single demand schedule by a
cooperative buying group and transmitting the accumulated product
demand to the manufacturer/original source of the product and to
the logistics and fulfillment provider are performed in accordance
with the operation of a predictive engine.
[0089] The method of paragraph 73, wherein the predictive engine
predicts future demand for products and logistics services.
[0090] The method of paragraph 72, wherein the step of shipping the
product from the manufacturer/original source of the product to one
or more of the plurality of end users, employing additional
logistics services via the logistics and fulfillment provider is
performed if the product order for a particular end user is less
than a predetermined amount.
[0091] The method of paragraph 69, wherein the step of providing
the product availability information together with the logistics
information to the plurality of end users by the cooperative buying
group is performed in accordance with the operation of an
optimization engine.
[0092] The method of paragraph 76, further comprising the steps
of:
[0093] receiving one or more end user requirements related to
delivery of the product; and
[0094] providing a most cost efficient method of logistics in
accordance with the received requirements.
[0095] The method of claim 77, wherein the one or more end user
requirements is selected from the group of cost, quality and
time.
[0096] The method of claim 76, further comprising the steps of:
[0097] receiving one or more end user requirements related to the
product; and
[0098] providing a most cost efficient method of procuring the
product from the manufacturer/original source of the product in
accordance with the received requirements.
[0099] The method of paragraph 79, wherein the one or more end user
requirements is selected from the group of cost, time, and product
characteristics.
[0100] The method of paragraph 80, wherein the optimization engine
suggests a change in one or more of the end user requirements in
order to improve one or more of the other end user
requirements.
[0101] The method of paragraph 69, wherein the cooperative buying
group is owned by each of the one or more of the plurality of end
users.
[0102] The method of paragraph 82, wherein the plurality of end
users are from one or more similar industries.
[0103] The method of paragraph 82, wherein the plurality of end
users are from a plurality of dissimilar industries.
[0104] The method of paragraph 69, wherein the step of ordering
product from the manufacturer/original source of the product is
performed by an expert procurement partner.
[0105] A computer program stored to a non-transitory computer
storage medium, the computer program causing a general purpose
computer to perform the steps of:
[0106] receiving information relating to past, present and future
product demand and consumption for each of a plurality of end users
in a predefined industry;
[0107] accumulating the received product demand into a single
predictive demand schedule by a cooperative buying group;
[0108] transmitting the accumulated predictive product demand
schedule to a manufacturer/original source of the product by the
cooperative buying group;
[0109] receiving product availability information based upon the
accumulated predictive product demand from the
manufacturer/original source of the product by the cooperative
buying group;
[0110] providing the product availability information to the
plurality of end users by the cooperative buying group;
[0111] providing the product availability information to the
plurality of end users by the cooperative buying group;
[0112] receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group;
[0113] ordering product from the manufacturer/original source of
the product in accordance with the received one or more product
orders by the cooperative buying group; and
[0114] shipping the product from the manufacturer/original source
of the product to one or more of the plurality of end users in
accordance with the received product order information for each of
the end users.
[0115] The computer program of paragraph 86, wherein the product is
shipped directly from the manufacturer/original source of the
product to a particular end user if the end user demands more than
a predetermined amount of product.
[0116] The computer program of paragraph 86, wherein the product is
a service.
[0117] The computer program of paragraph 86, wherein the computer
program further causes the computer program to perform the steps
of:
[0118] transmitting the accumulated product demand to a logistics
and fulfillment provider;
[0119] receiving logistics information from the logistics and
fulfillment provider;
[0120] providing the product availability information together with
the logistics information to the plurality of end users by the
cooperative buying group;
[0121] receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group;
[0122] ordering logistics services from the logistics and
fulfillment provider in accordance with the received one or more
product orders by the cooperative buying group;
[0123] shipping the product from the manufacturer/original source
of the product to one or more of the plurality of end users via the
logistics provider in accordance with the received product order
information for each of the end users.
[0124] The computer program of paragraph 89, wherein the step of
accumulating the received product demand into a single demand
schedule by a cooperative buying group and transmitting the
accumulated product demand to the manufacturer/original source of
the product and to the logistics and fulfillment provider are
performed in accordance with the operation of a predictive
engine.
[0125] The computer program of paragraph 90, wherein the predictive
engine predicts future demand for products and logistics
services.
[0126] The computer program of paragraph 89, wherein the step of
shipping the product from the manufacturer/original source of the
product to one or more of the plurality of end users, employing
additional logistics services via the logistics and fulfillment
provider is performed if the product order for a particular end
user is less than a predetermined amount.
[0127] The computer program of paragraph 86, wherein the step of
providing the product availability information together with the
logistics information to the plurality of end users by the
cooperative buying group is performed in accordance with the
operation of an optimization engine.
[0128] The computer program of paragraph 93, wherein the computer
program further causes the general purpose computer to perform the
steps of:
[0129] receiving one or more end user requirements related to
delivery of the product; and
[0130] providing a most cost efficient method of logistics in
accordance with the received end user requirements.
[0131] The computer program of paragraph 94, wherein the one or
more end user requirements is selected from the group of cost,
quality and time.
[0132] The computer program of paragraph 93, wherein the computer
program further causes the general purpose computer to perform the
steps of:
[0133] receiving one or more end user requirements related to the
product; and
[0134] providing a most cost efficient method of procuring the
product from the manufacturer/original source of the product in
accordance with the received end user requirements.
[0135] The computer program of paragraph 96, wherein the one or
more end user requirements is selected from the group of cost,
time, and product characteristics.
[0136] The computer program of paragraph 97, wherein the
optimization engine suggests a change in one or more of the end
user requirements in order to improve one or more of the other end
user requirements.
[0137] The computer program of paragraph 86, wherein the
cooperative buying group is owned by each of the one or more of the
plurality of end users.
[0138] The computer program of paragraph 99, wherein the plurality
of end users are from one or more similar industries.
[0139] The computer program of paragraph 99, wherein the plurality
of end users are from a plurality of dissimilar industries.
[0140] The computer program, of paragraph 86, wherein the step of
ordering product from the manufacturer/original source of the
product is performed by an expert procurement partner.
[0141] A single enterprise resource planning (ERP) system
incorporating information seamlessly, predicatively between
individual end users, logistics and fulfillment providers and
manufacturers or original sources of goods and services,
comprising:
[0142] an input for receiving information relating to product
demand and consumption for each of a plurality of end users via a
cooperative buying group;
[0143] a predictive engine for accumulating the received product
demand into a single demand schedule;
[0144] an output for transmitting the single demand schedule to a
manufacturer/original source of the product;
[0145] an optimization engine for receiving product availability
information from the manufacturer/original source of the product by
the cooperative buying group, and for determining one or more
options for ordering the products;
[0146] a procurement system for providing the product availability
information to the one or more options for ordering the products to
the plurality of end users by the cooperative buying group, for
receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group, for
ordering product from the manufacturer/original source of the
product in accordance with the received one or more product orders
by the cooperative buying group, and for managing shipping the
product from the manufacturer/original source of the product to one
or more of the plurality of end users in accordance with the
received product order information for each of the end users.
[0147] The single ERP system of paragraph 103, wherein the output
for transmitting the single demand schedule also transmits the
single demand schedule to a logistics and fulfillment provider.
[0148] The single ERP system of paragraph 104, wherein the
optimization engine further receives logistics information from the
logistics provider, provides the one or more options for ordering
the product together with the logistics information to the
plurality of end users by the cooperative buying group; and
[0149] wherein the procurement system receives one or more product
orders from one or more of the plurality of end users by the
cooperative buying group, orders product from the
manufacturer/original source of the product in accordance with the
received one or more product orders by the cooperative buying
group, and manages the shipping of the product from the
manufacturer/original source of the product to one or more of the
plurality of end users via the logistics provider in accordance
with the received product order information for each of the end
users.
[0150] The single ERP system of paragraph 105, wherein the product
comprises one of a product and a service.
[0151] The single ERP system of paragraph 105, wherein the
procurement system generates the one or more orders in place of the
one or more product orders from the one or more of the plurality of
end users, resulting in automatic ordering therefore, thus creating
a perpetual inventory system between the one or more plurality of
individual end users and the logistics providers and
manufacturer/original source of the product and services.
[0152] A method for procuring a product, comprising the steps
of:
[0153] aggregating specific demand for products and services from
multiple individual enterprises in one or more similar industries
by a cooperative buying group to reach one of a desired volume and
frequency level;
[0154] transmitting the accumulated aggregated product and services
demand to a manufacturer/original source of the product and service
by the cooperative buying group;
[0155] receiving product and service availability information based
upon the accumulated predictive product and service demand from the
manufacturer/original source of the product and service by the
cooperative buying group;
[0156] providing the product and service availability information
to the plurality of end users by the cooperative buying group;
[0157] receiving one or more product and service orders from one or
more of the plurality of end users by the cooperative buying
group;
[0158] ordering product and services from the manufacturer/original
source of the product and services in accordance with the received
one or more product and services orders by the cooperative buying
group, thereby disintermediating the supply chain and allowing for
procurement of product and services directly from manufacturers and
original sources of products and services; and
[0159] shipping the product and service from the
manufacturer/original source of the product and service to one or
more of the plurality of end users in accordance with the received
product and service order information for each of the end
users.
[0160] The method of paragraph 108, wherein demand is combined from
individual enterprises in multiple industries by a cooperative
buying group to reach one of a desired volume and frequency level
in order to disintermediate the supply chain.
[0161] The method of paragraph 109 wherein the product is shipped
directly from the manufacturer/original source of the product to a
particular end user if the end user demands more than a
predetermined amount of product.
[0162] The method of paragraph 109, wherein the product is a
service.
[0163] The method of paragraph 109, further comprising the steps
of:
[0164] transmitting the accumulated product and service demand to a
logistics and fulfillment provider;
[0165] receiving logistics information from the logistics and
fulfillment provider;
[0166] providing the product and service availability information
together with the logistics information to the plurality of end
users by the cooperative buying group;
[0167] receiving one or more product and service orders from one or
more of the plurality of end users by the cooperative buying
group;
[0168] ordering logistics services from the logistics and
fulfillment provider in accordance with the received one or more
product and service orders by the cooperative buying group;
[0169] shipping the product and service from the
manufacturer/original source of the product and service to one or
more of the plurality of end users via the logistics provider in
accordance with the received product and service order information
for each of the end users.
[0170] The method of paragraph 112, wherein the step of shipping
the product from the manufacturer/original source of the product to
one or more of the plurality of end users, employing additional
logistics services via the logistics and fulfillment provider is
performed if the product order for a particular end user is less
than a predetermined amount.
[0171] The method of paragraph 109, wherein the step of providing
the product availability information together with the logistics
information to the plurality of end users by the cooperative buying
group is performed in accordance with the operation of an
optimization engine.
[0172] The method of paragraph 114, further comprising the steps
of:
[0173] receiving one or more end user requirements related to
delivery of the product; and
[0174] providing a most cost efficient method of logistics in
accordance with the received end user requirements.
[0175] The method of paragraph 115, wherein the one or more end
user requirements is selected from the group of cost, quality and
time.
[0176] The method of paragraph 114, further comprising the steps
of:
[0177] receiving one or more end user requirements related to the
product; and
[0178] providing a most cost efficient method of procuring the
product from the manufacturer/original source of the product in
accordance with the received end user requirements.
[0179] The method of paragraph 117, wherein the one or more end
user requirements is selected from the group of cost, time, and
product characteristics.
[0180] The method of paragraph 118, wherein the optimization engine
suggests a change in one or more of the end user requirements in
order to improve one or more of the other end user
requirements.
[0181] The method of paragraph 109, wherein the cooperative buying
group is owned by each of the one or more of the plurality of end
users.
[0182] The method of paragraph 120, wherein the plurality of end
users are from one or more similar industries.
[0183] The method of paragraph 120, wherein the plurality of end
users are from a plurality of dissimilar industries.
[0184] The method of paragraph 109, wherein the step of ordering
product from the manufacturer/original source of the product is
performed by an expert procurement partner.
[0185] A computer program stored to a non-transitory computer
storage medium, the computer program causing a general purpose
computer to perform the steps of:
[0186] aggregating specific demand for products and services from
multiple individual enterprises in one or more similar industries
by a cooperative buying group to reach one of a desired volume and
frequency level;
[0187] transmitting the accumulated aggregated product and services
demand to a manufacturer/original source of the product and service
by the cooperative buying group;
[0188] receiving product and service availability information based
upon the accumulated predictive product and service demand from the
manufacturer/original source of the product and service by the
cooperative buying group;
[0189] providing the product and service availability information
to the plurality of end users by the cooperative buying group;
[0190] receiving one or more product and service orders from one or
more of the plurality of end users by the cooperative buying
group;
[0191] ordering product and services from the manufacturer/original
source of the product and services in accordance with the received
one or more product and services orders by the cooperative buying
group, thereby disintermediating the supply chain and allowing for
procurement of product and services directly from manufacturers and
original sources of products and services; and
[0192] shipping the product and service from the
manufacturer/original source of the product and service to one or
more of the plurality of end users in accordance with the received
product and service order information for each of the end
users.
[0193] The computer program of paragraph 124, wherein demand is
combined from individual enterprises in multiple industries by a
cooperative buying group to reach one of a desired volume and
frequency level in order to disintermediate the supply chain.
[0194] The computer program of paragraph 125 wherein the product is
shipped directly from the manufacturer/original source of the
product to a particular end user if the end user demands more than
a predetermined amount of product.
[0195] The computer program of paragraph 125, wherein the product
is a service.
[0196] The computer program of paragraph 125, wherein the computer
program further causes the general purpose computer to perform the
steps of:
[0197] transmitting the accumulated product and service demand to a
logistics and fulfillment provider;
[0198] receiving logistics information from the logistics and
fulfillment provider;
[0199] providing the product and service availability information
together with the logistics information to the plurality of end
users by the cooperative buying group;
[0200] receiving one or more product and service orders from one or
more of the plurality of end users by the cooperative buying
group;
[0201] ordering logistics services from the logistics and
fulfillment provider in accordance with the received one or more
product and service orders by the cooperative buying group;
[0202] shipping the product and service from the
manufacturer/original source of the product and service to one or
more of the plurality of end users via the logistics provider in
accordance with the received product and service order information
for each of the end users.
[0203] The computer program of paragraph 128, wherein the step of
shipping the product from the manufacturer/original source of the
product to one or more of the plurality of end users, employing
additional logistics services via the logistics and fulfillment
provider is performed if the product order for a particular end
user is less than a predetermined amount.
[0204] The computer program of paragraph 128, wherein the step of
providing the product availability information together with the
logistics information to the plurality of end users by the
cooperative buying group is performed in accordance with the
operation of an optimization engine.
[0205] The computer program of paragraph 130, wherein the computer
program further causes the general purpose computer to perform the
steps of:
[0206] receiving one or more end user requirements related to
delivery of the product; and
[0207] providing a most cost efficient method of logistics in
accordance with the received end user requirements.
[0208] The computer program of paragraph 131, wherein the one or
more end user requirements is selected from the group of cost,
quality and time.
[0209] The computer program of paragraph 132, wherein the computer
program further causes the general purpose computer to perform the
steps of:
[0210] receiving one or more end user requirements related to the
product; and
[0211] providing a most cost efficient method of procuring the
product from the manufacturer/original source of the product in
accordance with the received end user requirements.
[0212] The computer program of paragraph 133, wherein the one or
more end user requirements is selected from the group of cost,
time, and product characteristics.
[0213] The computer program of paragraph 134, wherein the
optimization engine suggests a change in one or more of the end
user requirements in order to improve one or more of the other end
user requirements.
[0214] The computer program of paragraph 128, further comprising
the step of automatically generating the one or more orders in
place of the one or more product orders from the one or more of the
plurality of end users, resulting in automatic ordering therefore,
thus creating a perpetual inventory system between the one or more
plurality of individual end users and the logistics providers and
manufacturer/original source of the product and services.
[0215] The computer program of paragraph 125, wherein the
cooperative buying group is owned by each of the one or more of the
plurality of end users.
[0216] The computer program of paragraph 137, wherein the plurality
of end users are from one or more similar industries.
[0217] The computer program of paragraph 137, wherein the plurality
of end users are from a plurality of dissimilar industries.
[0218] The computer program of paragraph 125, wherein the step of
ordering product from the manufacturer/original source of the
product is performed by an expert procurement partner.
[0219] A single enterprise resource planning (ERP) system
incorporating information seamlessly, predicatively between
individual end users, logistics and fulfillment providers and
manufacturers or original sources of goods and services,
comprising:
[0220] an aggregator for aggregating specific demand for products
and services from multiple individual enterprises in one or more
similar industries by a cooperative buying group to reach one of a
desired volume and frequency level;
[0221] an output for transmitting the accumulated aggregated
product and services demand to a manufacturer/original source of
the product and service by the cooperative buying group;
[0222] an optimization engine for receiving product availability
information from the manufacturer/original source of the product by
the cooperative buying group, and for determining one or more
options for ordering the products;
[0223] a procurement system for providing the product availability
information to the one or more options for ordering the products to
the plurality of end users by the cooperative buying group, for
receiving one or more product orders from one or more of the
plurality of end users by the cooperative buying group, for
ordering product from the manufacturer/original source of the
product in accordance with the received one or more product orders
by the cooperative buying group, and for managing shipping the
product from the manufacturer/original source of the product to one
or more of the plurality of end users in accordance with the
received product order information for each of the end users.
[0224] The single ERP system of paragraph 141, wherein the output
for transmitting the single demand schedule also transmits the
single demand schedule to a logistics and fulfillment provider.
[0225] The single ERP system of paragraph 142, wherein the
optimization engine further receives logistics information from the
logistics provider, provides the one or more options for ordering
the product together with the logistics information to the
plurality of end users by the cooperative buying group; and
[0226] wherein the procurement system receives one or more product
orders from one or more of the plurality of end users by the
cooperative buying group, orders product from the
manufacturer/original source of the product in accordance with the
received one or more product orders by the cooperative buying
group, and manages the shipping of the product from the
manufacturer/original source of the product to one or more of the
plurality of end users via the logistics provider in accordance
with the received product order information for each of the end
users.
[0227] The single ERP system of paragraph 143, wherein the product
comprises one of a product and a service.
[0228] The single ERP system of paragraph 143, wherein the
procurement system generates the one or more orders in place of the
one or more product orders from the one or more of the plurality of
end users, resulting in automatic ordering therefore, thus creating
a perpetual inventory system between the one or more plurality of
individual end users and the logistics providers and
manufacturer/original source of the product and services.
[0229] The single ERP system of paragraph 141, wherein demand is
combined from individual enterprises in multiple industries by a
cooperative buying group to reach one of a desired volume and
frequency level in order to disintermediate the supply chain.
[0230] Therefore, in accordance with one or more embodiments of the
present invention, as described above, an improved method and
system are provided for procuring goods and services for a
plurality of end users.
[0231] The invention accordingly comprises the several steps and
the relation of one or more of such steps with respect to each of
the others, and the apparatus embodying features of construction,
combinations of elements and arrangement of parts that are adapted
to affect such steps, all as exemplified in the following detailed
disclosure, and the scope of the invention will be indicated in the
claims.
* * * * *