Today’s businesses face extreme pressure to grow the top-line revenue and the margins. Companies invest in new markets’ penetration and developing new products. However, the rise in commodity prices is increasing the pressure on margins and diluting the investment. As a result, many leaders have to fund their critical investments through internal cost reduction measures.
Unveil a hidden opportunity for savings
In the drive for cost reductions, managers have aggressively deployed traditional cost-cutting strategies – operation closings, employee layoffs, benefit reductions, brand rationalization, and so on. Many leaders would think they have exhausted the possibilities for significant savings.
What many executives don’t expect is that a hidden opportunity for savings remains. By aggressively managing indirect services expenditures (i.e. marketing, travel, IT, etc. companies have a potential to realize up to a margin point or more of savings. Such expenditures are significant, consuming up to 15-30% of revenues in many companies.
However, these goods and services are complex – made up of hundreds of subcategories each with unique supply markets – and the fragmented way in which they are purchased, most companies have not been able to optimize this spend and are leaving significant savings on the street.
Through partnering with Lechner ProcessConsulting you can drive significant realized savings to your bottom line, enabling you to fund the growth and product innovation.
The Extended Procurement Factory provides value by optimizing the indirect spend areas though dedicated category management, market intelligence and integrative project management. You can grow your managed spend without having to invest in a growing procurement organization.