Managing supplier networks, scattered data and changing market conditions can send business expenses spiraling. Procurement is a critical yet often overlooked tool for driving efficiency and savings.
What if your strategy could help you surpass ambitious goals by over 50%? By partnering with GEP, a UK chemicals giant did just that, transforming its procurement into a strategic powerhouse.
In this deep-dive podcast, learn how smarter approaches, like leveraging total cost of ownership and streamlining supplier management, helped the chemicals company unlock 55% more savings and reshape operations.
What You'll Hear:
- How to streamline supplier management and payment processes
- Tactics to maximize savings with bulk purchasing
- Lessons to make procurement your competitive edge
Tune in now to elevate your procurement strategy!
PODCAST SUMMARY
Tackling Procurement Challenges: A Case Study
The podcast opens with a discussion of a UK chemicals company grappling with significant procurement complexities. With over £1.2 billion in total spend, of which £250 million was addressable, a daunting challenge given its tangled web of 17 global suppliers and a fragmented data system. Adding to the difficulty, they were implementing a new procurement system mid-operation, which exacerbated the chaos. To address these issues, the company brought in GEP, a procurement consultancy, to strategize and streamline their operations.
GEP’s Strategic Approach
GEP’s efforts began with a detailed analysis of the company’s existing contracts, uncovering areas for immediate cost savings and opportunities for long-term improvements. Central to their success was the use of meticulously crafted negotiation scripts, which anticipated supplier responses and focused on creating sustainable partnerships rather than forcing short-term discounts.
The consultancy also consolidated scattered data, turning an overwhelming mess of contracts, pricing histories, and market insights into a usable roadmap. Armed with this information, GEP leveraged strategies like volume discounts and total cost of ownership analysis, ensuring savings weren’t just limited to upfront costs but extended to factors like transportation, storage, and supply chain risks.
Results and Ripple Effects
The results exceeded expectations. The company achieved a 55% improvement on its original savings target, cutting costs by nearly £17 million. These savings enabled investments in R&D, new products, and advanced equipment, giving the company a competitive edge. Beyond financial gains, GEP’s intervention streamlined payment processes and strengthened supplier relationships, ensuring on-time payments and fostering trust. The company also established systems to manage strategic suppliers, transforming their outdated procurement process into a well-oiled machine.
This case study underscores how even seemingly insurmountable challenges can be overcome with strategic planning, data-driven decisions, and a commitment to sustainable practices.
