Case study: Courier services
Courier services have become increasingly important for the retail industry over the past couple of years, in a world where traditional bricks-and-mortar retail has been challenging to operate during lockdowns and with added restrictions. Even without the complications of the pandemic, online retail is growing in popularity and most retailers have adjusted their operations to reflect this.
Ebit’s approach to courier services
At Ebit, we frequently run courier procurement activity for retail and wholesale businesses, meaning that we have solid expertise and insight into key providers across the industry. As a result, we can quickly model a wide range of scenarios and fast-track negotiations to achieve fair-market rates. We seek to match the requirements and service expectations to the appropriate provider(s).
Here’s an example of how we can help:
About the client
Ebit worked with a £500m turnover retailer with nearly 500 branches across the UK and plans to expand across Europe. The client did not have an established internal procurement function for GNFR spend.
Project overview
Ebit engaged with the client on a consultancy basis, supported by Ebit’s contract management software. Reviewing all categories and sub-categories within GNFR spend, Ebit’s initial focus was on logistics and in particular courier services, both B2B and B2C. The long-term ambition of Ebit’s engagement with the client was to leave with procurement embedded into the culture and processes for all departments.
Results
The category review we ran resulted in a 6% (£620k annual saving). It also brought the rates down for Sunday deliveries to a point where it became commercially viable to offer this service.
Our approach was not just focused on short term rate card improvements. Alongside the formal tender, we helped develop a medium and long-term category strategy which, when implemented, will unlock additional savings.
Subsequent to the savings being delivered, we have continued to work with the client to draw up the appropriate commercial agreements, ensuring that the benefits negotiated do not get eroded over time. This includes SLAs, KPIs and service credits.
Get in touch to find out how Ebit can help your business with courier services and other spend categories.