Procurement Spend Reduction for a leading Delhi Bread Manufacturer
Title : Analysis of end-to-end procure to pay process including sourcing and planning, supplier collaboration, procure to pay, inventory management and reporting to reduce spend and improve efficiencies .
Background :
- Client is a leading bread manufacturer in Delhi NCR and accounts for 80% of the region’s market share
- Main Products are: Bread, Buns, Pizza Base,Rusks
- Procurement costs are more than 80% of total operating costs
- Company’s strategy is to expand the bakery product business across India through engaging with Contract Manufacturers
Our Approach :
Track 1 –
- Understand client Business & Supply Chain Objectives, Understand As-Is Procure to Pay Process & identify gaps and immediate focus areas
- Develop an organization structure design to set the base for any procurement focused initiative
- Define roadmap to improve the immediate target areas
Track 2 - Implement Procurement Processes and Initiatives for one product class
- Define To-be procurement process for Packing Material
- Implement Procurement Processes in the above area
- Deliver costs savings
Solution :
- Build a procurement organization, which is focused on improving and efficiently executing Procurement activities
- Sourcing savings - Increased understanding of spend by category. Take advantages of price discovery mechanisms
- Supplier management – Understand supplier cost structure, Optimize number of suppliers, Enter into Long-term Contracts
- Inventory management –Categorize inventory items, define policies and improve Store processes
- Develop Procurement KPIs and measure
Benefits :
- Understanding of procurement gaps and immediate focus areas
- Planned reduction of 10% in Packing Material Costs
- Road-map for effective Inventory Management
- Introduction of structured buying processes to support the expansion plans