Most Important Chances for Savings

Where are the possible savings ? Our experience, after 15 years in Global Sourcing, suggests the following:

Efficient software tools und training of the employees:
(TCO, freight cost calculator, vizualization, price negotiation)		 10 ... 15 %
   
Cooperation with qualified partners on site:
(Sourcing Scouts in the procurement countries)		 8 ... 12 %
   
Supplier management:
(Supplier selection, supplier qualification, relationship management, risk management)		 6 ... 10 %
   
Optimizing of internal processes:
(Preparation of neutral specifications, samplings, etc.) 		5 ... 10 %
   
Optimization of procurement logistics:
(Logistics concept, ValueServices of the forwarders)		 3 ... 8 %
   
Reduction of complexity:
(Product variety, data formats, data structure and parts list hierarchy) 		3 ... 5 %

Our Clients, who implemented and embraced the use of our tools, include:

  • Koerber Schleifring in Stuttgart / Germany
  • DORMA in Ennepetal / Germany
  • Wesselwerk in Reichshof / Germany
Average Savings*
in Electronics:
25 ... 40 %
Average Savings*
in Machinery:
20 ... 30 %
* Under Total Cost calculation
Source:
Global Procurement Services

Possibly sometimes you are told about of more than 50%. This is only possible in particular and individual cases. Of course, for some goods it is quite simple to get quotes which are only 20% of the current purchase price in Western Europe. However, due to poor quality, many companies afterwards faced big consequential failure costs, which resulted often in inability to deliver and sometimes even in chapter 11.