Case Study

Consumables - cost reduction project

Initial Opportunity

BIS were invited to tender on our Clients consumable goods. The Client was tasked with achieving a 10% cost down, a stable pricing structure and on time deliveries. Up to this point, the client had suffered numerous price increases and erratic deliveries which was having an impact on their production and costs. 

Project Scope

  • To achieve a cost saving to the client over the whole basket of goods of 10%.
  • To identify high risk, critical items.
  • To offer a next day service on core products.
  • To establish a linear pricing structure and introduce a proactive continuous improvement programme to initiate cost downs.

Execution

  • A dedicated Account Manager was allocated to oversee the identification and costing of the products with the aim to get a minimum 10% cost down.
  • Any critical high risk items are identified and a stocking agreement agreed.
  • Items which fall outside the current BIS Supplier database will be targeted and alternatives offered with the approval of the client. This enables BIS to have more control of the Supply Chain and pricing through economies of scale.

Customer Benefits

  • Initial cost saving on the basket of goods
  • Next day delivery on items agreed on the stock agreement
  • Reduction in inventory
  • Reduction in stock outs
  • Management of critical and high risk items
  • Consolidated invoicing
  • Linear pricing structure
  • Continuous Improvement Programme implemented