Third Party Cost Optimization
Context & Objective
The client wanted to identify cost saving opportunities and secure a streamlined purchasing process, whilst also making a thorough analysis of existing supplier base and open it up for competition.
Approach & Result
The project was conducted in two phases. During the first phase PIR conducted a spend analysis to identify and categorize consolidation opportunities, followed by an opportunity assessment of found opportunities. The second phase included sourcing optimization and development of the sourcing function, including several RFx processes and renegotiations with current supplier base.
The project resulted in a total estimated saving of 6% per year on addressable spend, and 25+ new agreements with suppliers. Additionally, the development of the sourcing function resulted in updated purchasing documentation and routines, clear purchasing guidelines, updated Data Protection Agreement, template for Termination Agreement, and general Terms and Conditions.