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The client operated a number of sites, who historically had conducted their own sourcing arrangements. As a result, there was a significant number of suppliers supplying workshop consumables across the group, with no co-ordinated activity to optimise how consumables were sourced.
Spend Solutions was engaged by the client to develop a strategic procurement solution of the workshop consumables spend category. The brief was to review the current state, identify the current issues then develop an overarching sourcing strategy that would optimise commercial & supply performance.
Following an initial review, Spend Solutions identified that the client would be able to obtain much improved commercial & performance outcomes by leveraging their combined size & consolidating spend with a preferred supplier. However, with a broad product range & geographically spread site list, a more discreet sourcing strategy was required to optimise commercial terms & meet performance expectations.
A sourcing strategy was developed by key product group, consolidating suppliers to meet commercial goals but aligning supplier capabilities for each product group.
Through a competitive tender process a preferred supplier was identified for each product group that delivered a 26% savings with improved commercial terms. Spend Solutions worked with key stakeholders to manage the supplier transition without disruption. By having primary suppliers, the client was able to develop a standard product list to minimise product creep as well as a consolidated usage report to monitor spend leakage.