Procurement’s Secret Weapon
Risk trivia:
Today’s trivia involves a very large, very random number, so go ahead and give yourself full credit if you get anywhere close.
Trivia question:
According to an analysis of corporate disclosures performed by Reuters, how much has Trump’s trade war cost global companies in lost sales and higher costs as of May 2025?
The answer can be found in the Stat of the Month section below.
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This issues key takeaways:
● Economic uncertainty has increased the pressure on procurement to manage costs and be a major line of defense in supply chain resilience
● Integrating financial health intelligence into the downselect process gives procurement officers critical insights into the financial condition and operational capacity of potential suppliers
● Robust financial health analytics can unlock and nurture innovative strategies for constructing and maintaining a healthy, resilient supply chain
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Snapshot: A straightforward solution for complex procurement challenges
By James H. Gellert, Executive Chair, RapidRatings
We’re almost at the midpoint of 2025, and thus far it hasn’t exactly been a fun-filled joyride.
Words like challenging and unpredictable come to mind. Brutal is another word that feels appropriate, and I’ll bet a lot of business owners would have a few choice words to add.
This newsletter has mirrored the tumultuous nature of the year. I’ve focused on topics that matter right now, which over and over has meant talking about increasing levels of financial risk, the potential impact of elevated risk on global supply chains, and the urgency of adopting a modern risk mitigation strategy.
The downstream impact of the Trump tariffs are enormous, and we’re mired in a business environment dominated by fear and anxiety and a global economy desperate for some good news.
Is that news coming in June? Evidently not, but today I want to pivot away from challenges and talk about solutions. Procurement solutions. Secret weapon solutions. So let’s do that.
Procurement at-a-glance
The disruptive factors of 2025 are a severe hindrance to procurement professionals trying to build profitable, sustainable partnerships with suppliers and third-party vendors.
Procurement specialists oversee a supplier selection process that’s incredibly complex, akin to assembling a multidimensional puzzle made up of pieces that are constantly evolving in shape and size. (I think a 1000-piece puzzle with pieces that stay the same is hard enough!)
The process is laborious but necessary. To borrow (and bend) an old adage, a supply chain is only as strong as its weakest link, and it's up to procurement to make sure suppliers fortify the chain, not weaken it.
The increasing pressure facing procurement
A strained economy amplifies how important having a comprehensive, efficient procurement process in place is.
That’s easier said than done amid the current economic upheaval, which increases the pressure and urgency on procurement officers to deliver results in key areas:
● Cut spending and control costs
● Strengthen supply chain resilience
● Establish supplier relationships effectively
● Identify and mitigate risk from the outset
Of course, setting a goal is different from achieving it, and the practical reality of procurement is that supplier selection can too often boil down to who has the lowest bid. That indicates an unsound and ultimately fragile procurement process, but it's understandable, or at least unsurprising, considering the economic realities of today.
Balancing normal procurement duties with today’s abnormal conditions isn’t easy, and it highlights how important it is that procurement utilize any tool that can improve operational durability and long-term health.
A secret weapon
Finally! I can stop harping on the doom and gloom challenges and start focusing on legitimate solutions.
Because there is in fact a practical procurement solution: integrating financial health intelligence into the down-selection process. This enhances procurement’s ability to detect, manage, and mitigate financial risk of a supplier base, and avoid potential supply chain disruptions.
Using a sophisticated financial health assessment tool during the RFX process gives procurement specialists actionable insights at a critical time, including:
● Full visibility into supplier financial health based on quantitative, objective analysis of their financial data
● Predictive analytics that go beyond today’s status to show a supplier’s medium and long-term financial outlook, exposing hidden risks that lagging metrics will miss
● Comprehensive, standardized financial health score that reflects overall stability and allows for benchmarking and a consistently replicable process period after period
Financial health intelligence as a resource is both expansive and exacting. It illuminates the overall financial standing of a company with unparalleled precision, arming organizations with critical insights that lead to more nuanced, informed decisions. For procurement, these decisions include not just which suppliers to work with (or avoid) but also tackling the bigger task of how to strategically build a diversified supplier base of varied strengths and risk levels.
For procurement teams to actively create more agile, resilient supply chains they can’t rely on financial scores that are outdated, incomplete or superficial. It’s also critical to have a complete picture of a supplier’s financial condition before hiring them. Lackadasical due diligence in the RFX process, for whatever reason, can have damaging long-term consequences that could have been avoided had the risk management been thorough from the start.
Lastly, a company using contemporary financial health tools can see benefits that go beyond just the down-selection process, such as creating more opportunities for active collaboration with suppliers and integrating innovation technology at a critical juncture in the development of AI.
But for now, I’m just happy I could talk about a solution instead of one of 2025’s many challenges.
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News & Notes
RapidRatings is excited to announce the appointment of Charlie Minutella to be our new Chief Executive Officer. Minutella brings over two decades of experience in the legal, risk, and compliance space, most recently having served as CEO of Data Zoo.
Congratulations Charlie, and welcome to the RapidRatings family!
Check out Charlie Minutella’s full bio here
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Stat of the Month: June
Kimberly Clark, parent company and maker of Kleenex, recently announced a loss of about $300 million in costs from increased supply chain expenses due to tariffs. There’s a bad joke to be made about needing a tissue, but I’d rather someone else make it.
Trivia answer:
While we’re talking tariffs, the estimated financial loss to companies from higher costs and lost sales as a result of Trump’s tariffs? A cool $34 billion, which Reuters was quick to point out is probably a wildly low estimate. If you guessed within $5 billion, take a bow.
If you’re curious about how RapidRatings offers the most accurate and comprehensive financial data analytics in the industry, check out RapidRatings.com to learn more.
