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EBIT

Case Study

2149273799

Ebit delivered a cost out consultancy project for a major bricks & mortar / online retailer of sporting goods and leisure wear. Working with the existing procurement team & business units we analysed all indirect spending, across 250+ suppliers and contracts. Initially retained for 6 months the expertise, insight, guidance and value delivered turned this project into a longer, wider-ranging engagement.

Client Overview

Ebit has been working with a well-known online & bricks and mortar retailer, with over 90 stores and multiple routes to market.

This retailer had identified a lack of controls and governance across their indirect spend categories throughout their business. Their procurement function focussed primarily on GFR activity and goods. 

With the backing of the Private Equity fund behind the retailer, Ebit were introduced to understand the current situation. As a result we could then identify and implement savings opportunities.

Additionally, we were tasked with devising, presenting and implementing procurement procedures across the indirect spend categories. 

Our Approach

Our  approach began with a review of the clients’ indirect spend and processes, identifying those suppliers with the greatest value and service to the business. To ensure we could deliver a successful project we engaged with multiple stakeholders across the business at the same time.

This allowed our team to understand the drivers behind business decisions and relationships with many suppliers 

Through the spend analysis, 257 suppliers were identified, with the top 25 responsible for over 80% of the indirect supplier spend.  

This allowed us to work with the procurement team collaboratively to identify opportunities. This led to us focussing on 11 core projects. We sat alongside the procurement team running the projects to re-negotiate or re-tender the categories as appropriate. 

Results

  • Annual spend of £5.4m analysed across 256 suppliers
  • Annual savings of £737,022 (14%) identified and re-negotiated or re-tendered as appropriate.
  • Supplier base successfully reduced, allowing for further savings in time and management across multiple business functions
  • Ebit was retained to manage the end-to-end process for these new contracts and renegotiations 
  • A further £62,861 of savings identified for future projects 
  • Procurement Policy, Gap Analysis, DLA & breach log all agreed and implemented 
  • Stakeholder buy-in and internal champions established to ensure continued buy-in and improvement
  • ROI across the project in excess of 4:1 in Year 1
£737,022
Annual Saving