Leading mining company outsourced its entire sourcing function
COMPANY
Leading copper mining company with an annual purchasing volume from China of ~$450M.
SITUATION
Company wants another organization in a better position than them to manage their sourcing category while implement right supplier matrix to secure set procurement strategies.
COMPLICATION
Weak ability to capture the maximum possible value from their categories sourced from China was based on a host of factors.
EPG CONTRIBUTION (at a glance)
The company outsourced its entire sourcing function to EPG. EPG was able to apply proven procurement levers as part of our
strategic sourcing activities-like volume-bundling, defending price increases via clean-sheet cost-breakdown approach, introducing new suppliers and re-negotiation with existing ones, and was also able to use low-cost processing operations. These changes helped the client to cut its overall operating costs by 60 percent, in addition to an average unit cost reduction by 22 percent.
KEY LEVERS
• Price negotiation with existing suppliers.
• Volume shifts to new suppliers.
• Design to cost and value engineering for key direct materials/parts.
• Clean-sheet approach to determine should vs does cost.
• Supply chain visualization covering every tier.
• Deliver compelling and measurable results on environmental, social, and governance (ESG) imperatives.
• Focusing on opportunities for value creation.
EPG stands for high performance, built on innovation, dedicated people, and long experience. With more than ten years of procurement outsourcing industry experience, EPG is one of the best providers of procurement outsourcing services in China. Our services, knowledge and methodology will guarantee you sustained spend savings, better ESG, and improved speed to value.
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