Case study

Procurement optimization for a technology company

Situation

A technology company maintained several large site locations as well as smaller sales and marketing offices distributed around the country. Each site and the field made its own contracting decision with very little standardization in product purchases across sites. The company hired a consultant to realize savings in procurement. Delivery Partners provided analytical support.

Our work

  • Analyzed overall strategy, best price negotiation and volume concentration
  • Identified existing and potential suppliers using internal and external data
  • Distributed RFP to all suppliers capable of supporting distribution across the country
  • Evaluated non-pricing supplier responses against the criteria used by the client to measure the performance of existing suppliers
  • Conducted pricing analysis focused on total cost, mark-up above cost, and discount from list prices

Results

  • Estimated annual savings of 12%, subsequently rolled out across the areas
  • Potential for additional savings of $2.5 million dependent on implementation of process recommendations
  • Elimination of open stock convenience centers
  • Expanded use of in-house product recycling center