CHALLENGE

A rapidly growing market leader in the non-alcoholic beverage sector sought to enhance its operating margin while maintaining its leadership in a category growing over 30% annually. The company conducted a six-week opportunity assessment to identify potential cost savings and subsequently launched a six-month pilot program focused on strategic sourcing in select direct and indirect spend categories. This pilot also aimed to transfer essential procurement skills and knowledge to the client’s team.

OUR ROLE

• Sustain market leadership amidst rapid growth
• Improve operating margin without disrupting business momentum
• Capture cost savings through optimized procurement practices 
• Collaborate with best-in-class suppliers to drive product innovation
• Upgrade procurement and supply chain talent and skills

SOLUTIONS

• Developed a comprehensive spend cube to provide a detailed categorization of procurement expenses beyond traditional accounts payable and general ledger data 
• Achieved significant cost reduction in key areas during the pilot program:
  • Labels: $4.33M savings
  • Office Products: $69k savings
  • Maintenance, Repair, and Operations (MRO): $440k savings 
  • Corrugated Packaging: $110k savings

OUTCOME

• Appointed a new Head of Procurement to lead ongoing improvements
• Negotiated supplier agreements yielding over $5M in savings during the pilot program
• Established partnerships with innovative suppliers, incorporating advanced technology to support product development