D – PRODUCTIVITY & COST IMPROVEMENT

par | Stratégie Achat

We believe that a total cost of ownership approach is the more beneficial to our clients. We therefore propose cost savings program in order to bring a clear understanding of our value to our clients.

We have a proven experience in delivering cost savings to our clients, and have detailed below all of the direct cost savings areas that we believe would be applicable to a Tail spend unique vendor relationship with your company. They are only indicative, as legislations, market maturity can open or close the doors to more saving areas.

BME Consulting have a proven track record of delivering direct and indirect innovative initiatives which have produced substantial process and cost efficiencies.

We have introduced initiatives as part of our relationship with our customers to great effect, reflecting our commitment to deliver continuous service improvement. We would welcome the opportunity to discuss these measures further with your company in compliance with the legal environment and the objectives of your sites in Europe.

D1 – Procurement outsourcing forecast
BME Consulting continues to look for new and better ways to build the best supplier pools for our clients. Although we still employ a variety of standard methods, such as eCatalogs, Supplier Portal, internet advertisements or direct sourcing, BME Consulting has found that with increasing competition for qualified suppliers, we need to work with each of our larger scale clients to create a much more sophisticated sourcing program for those harder to fill projects.

As such, BME Consulting has used a variety of client specific methodologies that we consider very successful in attracting the right suppliers. Because each order and geography is unique, transfers the process of developing these strategies, rather than the targeted approaches across clients. To develop a customized sourcing plan for your company, BME Consulting would move through the following process with your Procurement/Employee managers and any lead team members your company felt necessary to include:

  • Meetings With Local Managers – Through regular meetings, BME Consulting will gain a good understanding of your company business needs. Close liaison between our two companies at a local level will make us aware of future requirements – enabling us to source in advance of your orders.
  • Proactive Sourcing of Supplier Pool – As part of the implementation phase, each BME Consulting office can work with their local site to define a list of potential order likely to have same-day or urgent requests.
  • Local Branch Databases – Using our supplier database, we can identify local providers who have the product/service requested for the assignment.

These steps, while seemingly fundamental, are a key component to ensuring your company’s supplier pool is ready and filled with the best provider for your orders. By sharing your existing knowledge, BME Consulting can integrate industry best practices with already functional tactics and a reenergized referral program to deliver the calibre of supplier your company requires on an ongoing basis.

If the number of available suppliers in any purchasing area is limited, BME Consulting can immediately implement sourcing efforts to replenish our supply. This means that BME Consulting has a ready pool of skilled procurement employees in anticipation of your company order.

D2 – Measurable cost benefits
BME Consulting will provide your company a measurable cost benefit through a focused cost savings program that can be measured and presented to your company demonstrating the specific proposed savings.

This program is enhanced continually through the shared knowledge of other saving examples we currently do with your company in other regions as well as from our overall industry best practices and experiences.

This type of Cost Benefit program should be agreed at the beginning based on certain due diligence activities so it can be included in the implementation communication and road shows.

Other direct or indirect cost savings that we could bring under such schemes are included below.

Direct (Hard) Savings

  • Avoid supplier creation
  • Reduce accounting management
  • Negotiated eCatalogs
  • Potential reductions in core supplier margins in return for volume
  • Rationalizations of the rest of the supply chain and overall margin reductions
  • Migration and transition from non-core suppliers with consequent margin reductions.
  • Rationalization of additional costs – Better report, Validation workflow…

Indirect (Soft) Savings

  • Standardized and simplified processes
  • Reduced management time
  • Improved requisition process
  • Improved time for strategic procurement
  • Improved sourcing process
  • Supplier on-boarding
  • Improved quality of staff
  • Efficient invoicing and back-office processes
  • Improved cycle times
  • Attrition management
  • Performance management

BME Consulting will be happy to work closely with your company to build up such a program. At the time being, we have only a limited vision of your tail spend usage and processes and therefore cannot provide a firm commitment on productivity savings.

As a next step, we would be delighted to run audit productivity survey on your 2 largest sites in Europe to find ways of process improvements and added-value service delivery models.

D3 – Invoicing plan

BME Consulting Europe offers an Invoicing system that prevents changes to take place at local branch level.

All agreed terms are entered into our billing system and cannot be modified without prior authorization from the Key Account Manager.

 

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