Kormac Insights
Strategic Sourcing
Category Management
Inflation may have slowed, but prices remain stubbornly high across industries. 📈 We recently partnered with a leading industrial components provider to tackle this issue head-on. Our mission: reduce costs by developing and institutionalizing a rigorous Strategic Sourcing process.
Together with our client partner, here’s what we’ve achieved so far:
• Conducted spend review and category assessment
• Aligned Strategic Sourcing process methodology
• Evaluated market, customer, and supplier requirements
• Analyzed cost drivers
• Assessed suppliers and reviewed existing agreements
• Developed and issued RFXs (RFIs and RFPs)
The results? For our first spend category, Metal Fabrication, we’ve identified a 13% to 16% cost reduction opportunity across 59 parts! But we’re just getting started. Over the next month, we’ll address major spend categories representing 40% of our client’s annual COGS. In 2025, we’ll tackle the “spend tail” to uncover additional savings on lower-use items. Even in tough economic times, effective Strategic Sourcing can unlock significant savings.