Chemical Products Manufacturing

Direct Sourcing Execution in Manufacturing and Distribution

Client Outcomes

$4M Saved

CEO set a 12-month target of $4-6M in Direct Materials run-rate savings following a strategy consulting firm’s diagnostic identifying that range of savings was available from within the company’s entire COGS
The procurement team needed to develop a credible plan to reach the $4-6M target and show progress toward that goal within 12 weeks
The procurement team was fairly junior as well as under-staffed so Tezing was engaged to help drive the needed results

Tenzing conducted a detailed analysis of the spend and key supplier contracts to develop a pragmatic approach to save costs with a focus on the following key categories of spend: Chemicals, Aerosols, and Packaging
Tenzing worked with the Procurement team to identify which sub-categories of goods needed to go to RFP vs those available for direct negotiations (400+ products and 50+ suppliers were included in the Chemicals category alone)
Key stakeholders from across the organization were closely engaged during the sourcing, negotiations and contract award processes to ensure full alignment and sustainable decision making

Targeting only 12% of Direct Materials spend, savings exceeded $4M
Supplier management was streamlined by halving the number of active supplier
Tenzing accelerated time to savings by working hand-in-hand with the Procurement team and coaching team members through the sourcing and negotiation strategy to contract award process