Beyond Lowest Cost, Towards Lasting Value

For decades, procurement was judged by one simple question: Who quoted the lowest price? The answer often determined contracts, supplier relationships and, ultimately, organisational success. But today’s procurement landscape tells a very different story.

Across industries — from corporate facilities and food services to e-commerce and managed living — the limitations of the lowest-bid (L1) approach have become increasingly evident. Hidden costs in the form of quality failures, supply disruptions, compliance risks, operational inefficiencies, packaging waste and customer dissatisfaction frequently outweigh the apparent savings secured at the negotiation table.

As businesses navigate volatile supply chains, rising sustainability expectations, rapid digital transformation and demanding customers, procurement has evolved from a transactional buying function into a strategic business enabler. The focus is shifting from price to value, and from vendor selection to partnership building. Concepts such as Total Cost of Ownership (TCO), lifecycle costing, supplier reliability, digital procurement, ESG compliance, packaging innovation and risk management now sit at the heart of procurement strategy.

This special feature brings together the perspectives of four senior procurement leaders, each representing a distinct industry yet united by a common belief: the cheapest option is rarely the smartest one.

Ruchita Mishra, Director – Procurement & Supply Chain Management, Sodexo India Pvt. Ltd, explains why procurement must move beyond the obsession with the lowest quote and instead measure the true cost of business decisions. Dr. Sayantan Sinha, KVP, Vice-President (Facilities Management & Group Procurement), JMD Group, advocates best value procurement, where technical competence, resilience, sustainability and lifecycle value take precedence over price alone.

Dr. Priya Malhotra, Vice-President (Procurement & Supply Chain), Stanza Living, demonstrates how procurement directly shapes resident experience, operational excellence and brand reputation. Adding the fast-paced perspective of modern retail, Vinayaka Gangavathi, Head – Procurement (Projects & Admin) at Innovative Retail Concepts Pvt Ltd (BigBasket), highlights how strategic procurement decisions — from standardising warehouse infrastructure and optimising packaging to leveraging digital procurement platforms — influence operational efficiency and sustainability.

Together, these four viewpoints reinforce a powerful message: Procurement is no longer about buying cheaply; it is about buying intelligently, enabling business performance, managing risk proactively, driving sustainability and creating long-term value across the entire supply chain.

Also Read –

• Why Healthcare Procurement Can No Longer Be Driven By Cost Alone
• The Death of the Lowest Bid Why Cheapest is a Liability, not KPI
• Not All Low Bids Are Bargains, Some Are Warnings
• The Strategic Voice of Modern Procurement
• Procurement Beyond Purchasing: Enhancing Resident Experience in Managed Living