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Cases) Spend management/strategic sourcing/SCM outsourcing

Our spend management / strategic sourcing / SCM outsourcing cases are divided into two patterns: 1) professional management that sets up the operation functions and manages the daily operations of that functions, and (2) executing individual strategic sourcing events.

Below are some of our client cases of spend management / strategic sourcing / SCM outsourcing.  Please click the titles of the cases to see overviews of the cases.

Establishing and managing strategic sourcing department - Health food and cosmetics ODM manufacturer

Client) Health food / cosmetics ODM manufacturer
Spend categories) Direct: raw materials including some global sourcing, packaging, cosmetic boxes, corrugate boxes, etc. / Indirect: Office supplies, etc.
Issues)
 →Strengthen strategic sourcing capability as a company
 →Though there was a purchasing department, design engineers source direct materials
Our tasks)
 →As the head of strategic sourcing and purchasing department, launching and managing engineering buy and strategic sourcing function, while managing the existing purchasing department
 →The development of overseas suppliers for beauty materials and health food raw materials was also included as our responsibility
 →Annual purchase amount was USD 25 million, 2,700 items

Strategic sourcing of direct and indirect materials Role of purchasing department – IT infrastructure hosting and maintenance service companies

Client) Global IT company
Spend categories) Direct: Field engineer outsourcing, etc. / Indirect: Corporate services, office supplies, etc.
Issues)
 →Service partner sourcing had been left to a Japanese sole partner
 →With the expansion of business in Japan and securing of competitiveness, the client business strategy was changed to establish own operation in Japan
 →However there was no procurement function in Japan for realizing that strategy
Our tasks)
As a customer procurement purchasing department
 →Development of partners to provide services
 →Supplier registration
 →Improving the performance of partners
 →Procurement of both direct and indirect spends, such as corporate services and office supplies

Role of direct spend sourcing department – ​​Marketing spend management company

Client) Global marketing spend management company
Spend categories) Direct: Sales promotion furniture, furniture installation / maintenance / repair, campaign premiums advertising agency, etc.
Issues)
 →Local sourcing in Japan was required due to an increase in the number of end clients who required Japanese suppliers such as ones with tight lead times
 →The client had appointed its own Chinese supplier to supply to Japan, so there was no procurement function in Japan, and it was necessary to secure a procurement function in Japan.
Our tasks)
 →As a local sourcing department in Japan, we are in charge of supplier development, selection, and supplier registration.

Establishment, operation, and management of centralized purchasing and vendor management process for telemarketing – Software company

Client) Global software company
Spend categories) Indirect: Tele-marketing
Issues)
 →Local sourcing in Japan was required due to an increase in the number of end clients who required Japanese suppliers such as ones with tight lead times
 →10 marketers had selected and managed telemarketing vendors by marketing campaign
 →Performance and ROI largely varied by marketing campaign
 →Wasteful duplication of vendor selections, educations, and orientation processes
Our tasks)
 →From individual buying by each marketer, by each campaign, to centralized purchasing and contract buying
 →Establishment of vendor management position for telemarketing vendors, taking this vendor management role, and conducted below tasks
 →Selecting high Performing vendors for inbound and outbound calls separately
 →Securing high performing tele-agents
 →Improving the number of sales leads, calls per agent, and simplifying the interaction between the marketers and the telemarketing vendors by standardizing operations and transferring clients' rich knowledge to subcontractors

Global sourcing for consignment manufacturing of exterior PB products - Real estate development company

Client) Real estate development company
Spend categories) Direct: PB (Private brand) exterior
Issues) There were no in-house personnel who could conduct global sourcing, even though the client had embarked on the development of PB exteriors
Our tasks)
 →Developed Chinese suppliers
 →Preparing RFQ documents/ RFQ distributions/ Quote collections and award analyses/ Supplier selection

Cost reduction of internet streaming service - Pharmaceutical manufacturer

Client) Pharmaceutical manufacturer
Spend categories) Indirect: Internet streaming service
Issues)
 →At that time, internet streaming services were just appeared and only very expensive ones were available
 →It was unclear whether the services were purchased at appropriate prices
 →The services were purchased by each marketer in each business division from different vendors, and line items of invoice and those unit prices varied by each project
Our tasks)
 →From individual buying by each marketer, by each project, to centralized purchasing and contract buying
 →Assorting requirements from business divisions / preparing RFQ documents/ RFQ distributions/ quote collections and award analysis/ supplier selection
 →USD700,000, 48.5% Annual cost reduction

Indirect spends cost reduction - Casual wear SPA

Client) Global top class casual wear SPA
Spend categories) Indirect: Corrugated cardboard, advertising agencies, import vendors of furniture and fixtures, store construction work
Issues)
 →Although cost reduction of indirect spends was required, it does not proceed because there was no dedicated sourcing staff for indirect spends
Our tasks)
 →As a client’s sourcing staff, SSI conducted sourcing events
 →Building competitive environment for assigned categories by cultivating new suppliers
 →Preparing RFQ documents/ RFQ distributions/ quote collections and award analyses/ supplier selections
 →The average annual cost reduction rate for these was over 50%

Cost reductions for vehicle maintenance leasing / courier service - Pharmaceutical manufacturer

Client) Pharmaceutical manufacturer
Spend categories) Indirect: Vehicle maintenance lease, courier service
Issues)
 →No dedicated sourcing staff for indirect spends
 →Lack of in-house know-how and methodology for cost reductions
Our tasks)
 →New supplier developments / prepareing RFQ documents/ RFQ distributions/ quote collections/ award analyses/ supplier selections
 →Vehicle maintenance lease: USD 2 million, 33% cost reduction from USD 6 million annual spend
 → Courier service: USD 230 thousands, 32.8% cost reduction from USD 700 thousands spend

Selection of management consulting company – Bath/toiletry product manufacturer

Client) Bath / toiletry product manufacturer
Spend categories) Indirect: Management consulting
Issues)
 →The client had decided to appoint a management consulting company for the first time, and lacking in-house know-how for selecting it
Our tasks)
 →New supplier developments / prepare RFP documents/ RFP distributions/ proposal collections/ proposal evaluation/ award analysis/ supplier selection
 →Reduced the client’s risk, 1st phase contract amount to 1/8 by introducing phase system and performance fee type contract

Support for global sourcing roll out to Asia - Consumer goods manufacturer

Client) Consumer goods manufacturer
Spend categories) Direct: Plastic backs, films
Issues)
 →Insufficient human resources in-house for rollout of large-scale electronic bidding system to Asia
Our tasks)
 →Creating user / supplier manuals
 →Conducting supplier training sessions for suppliers in India, South Korea, and Japan
 →System preparations
 →User / supplier support for the electronic biddings

Please contact us, if you have any questions or inquiries on our spend management/strategic sourcing/SCM outsourcing services.

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