The client had a stable supply base that had been in place for many years. While generally happy with the suppliers' performance they needed to reduce costs & assumed the only plausible option was to change suppliers. They sought Spend Solutions expertise on how best to navigate a path to success that didn't require significant time or risk.
Spend Solutions was engaged to identify cost savings opportunities with a focus on delivering immediate savings.
Spend Solution conducted a thorough analysis of the clients spend, including spend categorisation to identify the most interesting suppliers & product groups. A deeper analysis of targeted suppliers identified those suppliers that met specific criteria to be suitable for direct negotiations. Analysis of current pricing compared against Spend Solutions market intelligence quantified the potential savings opportunity.
A negotiation program was developed with the client that provided a clear timeline, targets & expected outcomes. Once approved by the client, Spend Solutions implemented the program on behalf of the client, including regular updates & reports.
Spend Solutions identified 5 products groups suitable for immediate negotiations; security, coffee machines, office cleaning, warehouse consumables & fuel cards. Over the course of 2 months Spend Solutions conducted direct negotiations with targeted suppliers from each product group, delivering savings up to 25%. Additional benefits delivered included improved commercial terms, ongoing reporting & improved account management.