Case Study:

Garden retail chain identifies direct global sourcing for procurement and EBIT improvement.

Client

Private equity owned garden retail chain looking to improve profit margin. Procurement already centralised and well-developed but with no direct global sourcing

The project objective was to identify cost reduction opportunities by moving away from agents to direct global sourcing.

Approach

Identification of 15 potential product categories suitable for global sourcing.

Supply market analysis to identify sourcing regions and long-list of potential suppliers.

Development of specifications for benchmark products

Global sourcing to understand indicative pricing and calculation of equivalent landed costs for comparison

Results

  • Identification of a range of sourcing regions for product ranges
  • Identification of potential factories and logistics routes
  • Sourcing activity based on basket of benchmark products to understand commercial opportunity

 

World Chart

Identified saving of 17% across 15 product groups through direct global sourcing

 

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