The Weekly Pull #003

Howdy nerds - 

Here’s what’s been breaking my procurement brain over the past week (Yeah, I’m biased and no, I don’t care):

1. EU proposed massive rise in Defense budget for 2028 - 2034.

   This is big and I cannot stress it enough. We’re going to compete with defense for suppliers, materials and talent. Big, Beautiful Corporate firms are slow and cash strapped - Defense? Faster approvals. Bigger budgets. Front of the queue.

2. Asia’s Payment Outsourcing Rules Tighten.

   Say hello to stricter filling and oversight rules in Asia - payment processors have to register with local authorities before operations, adding layers of compliance and operational risk.

3. Goodbye to ASML Monopoly, Kind Regards - China

   China is rapidly developing in house extreme UV lithography systems - essential for advanced chipmaking.

   If successful, this could redraw global chip supply chains and split the market between West-aligned and China-aligned ecosystems.

4. and a BONUS on AI & Procurement, because it’s on everyone’s lips, right?

But first -

What I’ve Been Nerding Out On (aka What’s in the Procure Nerds Vault this week)

I kept busy.

Red Hat Negotiation Kit

Red flags, clause traps, and the sneaky “core logic” no one explains until it’s too late. 📎 🔍 Explore it: https://procurenerds.gumroad.com/l/redhat-negotiation-kit

Supplier Scorecard: Pharma Edition

A deep-dive scorecard tailored for heavily regulated pharma suppliers. Includes audit weightings, defect thresholds, ESG modifiers, and why PPM alone won’t save you during inspections.

🔍 Explore it: https://procurenerds.gumroad.com/l/pharmascorecard

SaaS Contract Clauses That will Haunt You

Auto-renew is just the start. These 5 clauses quietly wreck leverage, inflate TCO, and keep your legal team in therapy. You’ve probably signed at least 3 of them.

🔍 Explore it: https://procurenerds.gumroad.com/l/5-important-clauses-SaaS-contract

Europe’s 5% Defense Pledge

If you're sourcing for defense, security, or infrastructure — your indirects are about to get dragged into budget prioritization. 📎

🔍 Explore it: https://newsletter.procurenerds.com/p/europe-s-5-defense-pledge

Signals This Week: What Just Happened?

Let’s dive in.

1. EU proposed massive rise in Defense budget for 2028 - 2034

I’ve tried to wrap my head around this one for some time now.

You ignored this last week. That’s fine. Defense will ignore your PO next year. Here’s why.

To make matters even more interesting, the EU’s recently proposed budget for 2028–2034 includes a 5x increase in defense & space funding—€131 billion aimed at building industrial and military self-reliance. Source here.

So let’s try again, Why it matters:

• Strategic suppliers (aerospace, semiconductors, advanced manufacturing, AI, optics) will prioritize defense over corporate clients.

• Expect longer lead times, fewer discounts, and less leverage.

• Dual-use SMEs will chase EU funding—your niche innovation partners may ghost you.

What you should do NOW: 

• Run a capacity risk audit on any supplier in defense-adjacent sectors.

• Lock in volume-based contracts with delivery guarantees now.

• Update SLAs to include priority allocation and early-warning clauses.

• Co-develop with dual-use vendors—but secure private IP before they go military-grade.

Want a tool to tier your defense-adjacent suppliers and prep for long lead times?
👉 Check out the Supplier Scorecard: Manufacturing & Pharma Editions — can be easily repurposed for aerospace, optics, or AI vendors.

2. Asia’s Payment Outsourcing Rules Tighten

We have regulators in Singapore, Malaysia, and Hong Kong enforcing new licensing and registration rules for outsourced payment processors and banking-as-a-service vendors.

Source here.

Why it matters:

• Shared services or payment tech vendors that haven’t registered face fines or service shutdowns.

• Risk is high for procurement teams using APAC fintech, treasury services, or outsourced compliance platforms.

What you should do NOW:

• Add regulatory license verification to supplier onboarding in APAC.

• Require written confirmation of registration status and local compliance team contact.

• For critical vendors, request a regulatory health letter (like a SOC report, but for licenses).

3. Goodbye ASML Monopoly, Kind Regards - China

China is rapidly developing homegrown extreme ultraviolet (EUV) lithography systems, essential for advanced chipmaking. Basically threatening to upend ASML’s chokehold.

Sure, they’re years away from scale and maturity. But the build-up is real — and your roadmap needs to account for it.

Source here.

Why it matters:

• If successful, this could redraw global chip supply chains and split the market between West-aligned and China-aligned ecosystems.

• Procurement teams in AI, telecom, defense, and automotive will face new sourcing questions and regulatory redlines.

What you should do, at some point:

• Reassess your chip supplier map: flag all nodes dependent on ASML vs emerging Chinese tech.

• Add “EUV origin risk” to your vendor risk model.

• Start internal alignment on acceptable jurisdictions before the chips hit the fan.

Building a dual-path sourcing map?
👉 Start with the Asia Risk Playbook — it’s built to flag exposure by region and node type.

And here comes the BONUS:

4. AI in Procurement — Ignore the Hype, Fix the Gaps

While “AI” has been the buzzword of the past years, I haven’t read about adoption much in Procurement - only the regular villains, sale pitching the s***t out of it.

Numbers vary widely, and The Hackett Group reports about 47% of orgs are using it in existing procurement software (eg Coupa AI, SAP Joule Copilot). I personally doubt it’s that much, especially large scale deployment.

One thing’s for sure - Big, Beautiful Corporate world loves talking about it and spend on it. It’s here to stay, and it’s about time Procurement benefits from it. We’re overworked, understaffed, and drowning in half-baked systems — all while being asked to deliver shareholder value like it’s magic

So Why it matters:

• Procurement without AI is like finance without Excel.

• The capability gap is becoming a credibility gap with leadership.

• Manual QBRs, contract chasing/flagging, vendor vetting, risk alerts - need I say more?

What you should do NOW:

• Identify ONE use case, pilot it, build the damn business case and then scale.

  We need the mental bandwidth for strategy and proactiveness - not manual work.

The bottom line. What it Means for YOU.

Many things happen all at once. Procurement not only needs to stay afloat, but deliver value. Consistently. Margins of error are getting smaller.

We need to think about geopolitical impact.

So let’s fix some of them now:

• Defense Demand Is Surging
  → Pre-book capacity with key suppliers.
  → Prioritize partnerships with dual-use vendors before they’re locked into government contracts.

• Compliance Is Tightening in Asia
  → Vet all fintech, treasury, and shared-service vendors for local regulatory filings.
  → Add licensing verification to onboarding — especially in Singapore, Malaysia, and Hong Kong.

• Chip Supply Chains Are Splintering
  → Map your semiconductor exposure by region (China vs. ASML vs. mixed origin).
  → Build a sourcing strategy that accounts for tech sovereignty and export controls.

• AI Maturity Is Now a Differentiator
  → Run focused pilots for one high-impact use case: sourcing automation, clause alerts, or sentiment scoring.
  → Track ROI, build internal credibility, and scale.

We’re not just buying things anymore. We’re forecasting risk, outmaneuvering defense contracts, and trying to sleep at night.

Stay nerdy,
Zvi