The competitive advantage of a manufacturer is determined by its ability to procure effectively. External spend typically represents more than 70% of all costs, yet the supply chain is also a major source of innovation and quality so bearing down on price alone is rarely a sustainable strategy.
Commodity price fluctuations demand agile and proactive sourcing while the global scope of spend categories requires an open-minded and international Procurement organization able to implement customized and holistic approaches.
Efficio has the expertise to identify major opportunities for improvement, and helps you deliver these savings and embed organizations and processes that can build further benefits long term. Our experience across a broad range of clients, markets, commodities and sourcing practices allows us to recognize the potential for improvement often more clearly than the company management. And as an independent adviser, we operate outside internal politics and corporate silos.
Efficio introduced a major cultural change in the organization and the approach to the introduction of new products and suppliers has proven to be both effective and continuously able to deliver strong results.
We help manufacturing companies to address direct spend (Raw Materials, Commodities, Components, Spare Parts), Engineering spend (Design, Outsourced Engineering), Capex (Plant, Machinery) and indirect costs (Facilities Management, Transportation, Logistics, MRO). From the largest global corporations like Ford, ABB, KONE, Cadbury Schweppes, Bosch, Hitachi to medium-sized domestic companies, we offer a customized approach, whether appropriate to highly regulated and quality sensitive industries or to ones where service level and supply chain integration are key.
Efficio’s willingness to deliver the identified benefits at our risk, linking fees to the results achieved, underpins our credibility. Once engaged in a sourcing program, the Efficio team works with your organization and directly engages with the market, internal technical and specifying functions and stakeholders.
Our multinational teams have experience drawn from all the relevant supply and consumption regions, from the US and EU to East Asia, Eastern Europe, Latin America, India, and elsewhere. From basic commodities to the most sophisticated systems and services, direct or indirect, Efficio is able to deploy the right combination of Procurement experts and analysts to assure investment payback in months rather than years.
Spend transparency is crucial in a sector where companies are often global and multi-site. Efficio looks for ways to provide more real-time data analytics, for example, through the use of a monthly refresh cycle to enhance Enterprise Resource Planning (ERP). We address both cost and working capital optimization to develop a sourcing approach that satisfies your internal stakeholders, operational constraints and the overall business objectives. The strategic levers we apply include:
- Global sourcing
- Setting Supply base tiers
- Specification optimization
- Indexed long-term agreements
- Transactional improvement
- Cost unbundling
We understand the constraints under which Manufacturing labors, and are accustomed to working with imperfect specifications, shortage of client staff, volatile markets, multisite organizations and fragmented supply bases. We manage these situations short term, and provide the basis for long-term continuing improvement.
We typically achieve savings of 10-20% by commodity, while making a significant impact on working capital, service level and innovation. In the words of one of our manufacturing clients, Efficio “introduced a major cultural change in the organization and the approach to the introduction of new products and suppliers has proven to be both effective and continuously able to deliver strong results”.