The NEVI Procurement Day is the yearly event that the Dutch association for Procurement professionals, NEVI is organizing. This year it took place on 1 October 2019, and attracted a crowd of more than 400 procurement professionals from the Netherlands.
Richard Cornielje hosted a workshop to explain the advantages of the KYOS Portfolio and Risk Management System.
As a purchaser or procurement manager, you are involved in buying (multiple) commodities for the production processes of the business. Maybe you can demand price flexibility from your larger suppliers, which hopefully results in contracts with new price indexations. When contracts include price indexations to traded commodities, financial risk management becomes inevitable. In addition, risk mitigation via (financial) hedging will become common practice. This is where the complexity starts and you will have to involve your colleagues from finance and treasury.
Richard showed a few examples how easy is it to manage your contracts in the portfolio system and how you can compare them. As a result, it will lead to the lowest costs and highest income for the business. For you, it will save time compared to an Excel based analysis.
In co-operation with NEVI we launched the NEVI Commodity Tool. This tool will contain a set of default commodities and contracts, for example metals, cocoa, coffee, milling wheat, sugar, corn and Dutch energy. Everyday actual market prices are available. In combination with the calculated volatilities, you will have insight in risks. For example “what can happen with the price if you wait another day”. Or, what is your potential cash-flow during 2020 when you do not hedge at all. The tool will provide you with answers, that will grow your risk awareness. It will allow you to make better prepared decisions, and will help you, together with your colleagus in finance and Treasury to select and execute the optimal hedging strategy.
The NEVI Commodity Tool is an easy and low-cost solution to start optimizing your commodity procurement! If you have more specific commodity contracts and/or other commodities then already offered – please contact us for more information: firstname.lastname@example.org.