Due to persistent supply chain issues and rising inflation, the cost of goods and services for the Consumer-Packaged Good (CPG) industry are steadily rising. However, a closer look reveals that the supply and demand curve for many CPGs is leveling out. Consumer purchasing has slowed, limiting the ability for organizations to increase prices to mitigate cost increases. Other measures must be implemented to mitigate inflationary pressures and rising supply chain costs.
Typically, indirect goods and services represent 20% of a CPG organization’s revenue. While direct spend is tightly managed across these businesses, indirect procurement teams often lack the resources, focus, and scale for best-in-class buying, representing millions in lost savings opportunities. LogicSource focuses only on indirect spend solutions that are designed by procurement experts to deliver both commercial savings and persistent operational value that improves time to market and profitability.
LogicSource partnered with a globally recognized equipment manufacturer to deliver value across Corporate Services, IT, Marketing Services, Print, Packaging, Logistics, and Facilities spend, resulting in $8MM in realized cost reductions for the manufacturer. Throughout the engagement, LogicSource has driven significant incremental value developing contract management best practices, effectively implementing procurement technology, and streamlining operations and supplier engagement.
LogicSource partnered with a leading consumer goods manufacturer to deliver more than 7% savings across their Facilities, IT, Marketing and Corporate Services spend. LogicSource helped to globalize their supplier base by identifying strategic suppliers to support their international footprint rather than relying on local suppliers in each market. In addition to the cost reductions, the transition has significantly simplified and standardized service delivery, reporting and metrics for the organizations management teams.
The first step is to request a Value Hypothesis, which provides an initial savings estimate based on our proprietary industry data and publicly available information on your organization. LogicSource will then validate the savings opportunity through a Mutual Value Assessment (MVA) – a comprehensive no-cost analysis of your indirect spend management process.