Automotive global supplier: generating value from sourcing
Background
The client, an global automotive supplier with sales of over €900m, having achieved significant growth through acquisitions, was facing market pressures for cost reductions and responsiveness.
As a result of this, a major transformation programme was launched, of which the optimisation of the supply chain was a critical element.
What We Did
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Carried out a Make v Buy exercise, identifying opportunities to outsource non-strategic product lines to low cost sourcing.
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Rationalisation of the product portfolio, eliminating the complexity generated by the poor integration of acquisitions.
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Assisted in the setting up of a new Sourcing Organisation, including developing the processes and capabilities required to support the business
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Supported the formulation and execution of sourcing strategies for each commodity with different characteristics, supplier relationships and opportunities
Results
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Standardisation of purchased parts, reducing part numbers by more than 50%,
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Achieved 7% short term savings and medium-long term savings up to 18%
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Sourcing from low cost countries of low risk commodities, realising a 35% cost reduction.
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Reduced footprint by moving non-strategic product lines to a supplier in India.
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A new sourcing organisation and robust management processes capable of supporting the business through the whole product life cycle.
