Case study · Logistics
Business products distributor saves $1.5M and cuts spend 11% through supplier collaboration
A North American business products distributor needed to lower the cost of planning, buying, moving and storing inventory. USC built a six-step supplier collaboration process covering freight, discounts, electronic data interchange (EDI) credits and joint stocking.
Results
$1.5M
in implemented savings from supplier collaboration
11%
reduction in spend
Savings were in place by the end of the engagement.
The situation
To stay competitive and pass savings to its customers, the distributor wanted to lower the cost of planning, purchasing, transporting and storing the materials it sells, by eliminating non-value-added activities and unnecessary supplier services.
What the assessment found
- Untapped savings in purchasing, receiving and payables
- No structured way to engage suppliers on freight and discounts
- Transaction-heavy activities not automated
How the work was done
Diagnostic: find the savings
Reviewed central purchasing, receiving and payables to uncover cost savings and set a roadmap for supplier collaboration.
Suppliers: collaborate in six steps
Identified, vetted and visited suppliers, analyzed their data, set strategies, negotiated and tracked results on a scorecard, across freight, discounts, EDI credits and joint stocking.
$1.5M
in savings from supplier collaboration
Transactions: automate the routine
Automated transaction-heavy work such as EDI, advance ship notices and pay-on-receipt.
“Without USCCG's capable assistance we could've never undertaken this initiative. With it, we not only met but surpassed expectations.”
Lasting impact
Most of the savings came from areas that were new to the distributor, supporting its expanding service offerings.
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