In today’s inflationary and disruptive business environment, breakdowns along the complex global supply chain have caused shipping costs and other expenses to soar. In response to these pressures, retailers are struggling with balancing how much of these rising costs they can pass along at the register and how much they need to absorb to retain price-conscious consumers. However, there’s a third option that too many retailers leave unaddressed that can help to mitigate these cost pressures and drive significant bottom-line improvements.
Typically equating to more than 20% of a retailer’s annual revenue, indirect–or not-for-resale–goods and services represent a significant opportunity for profit improvement. While a retailer may have hundreds of dedicated merchandising resources to manage their organization’s direct expenditures, too often, there are only a handful focused on indirect, resulting in the mismanagement of what can be billions of dollars in spend. What if retail leaders invested in indirect spending with the same resources and human capital as they do for direct? LogicSource solutions are tailor-made to address an organization’s full scope of indirect spending, bringing unmatched procurement expertise to drive measurable and sustainable profit improvement for the world’s leading retail brands.
LogicSource partnered with a multibillion-dollar retailer to deliver value across Facilities, Information Technology, Corporate Services, Packaging, Print, and Marketing Services. The result was more than $50MM in savings over three years, which freed up funds to invest in the client’s growing eCommerce business. As part of the partnership, LogicSource supports other important initiatives, including labor optimization for in-store, distribution and fulfillment center associates, and delivery teams supporting the operational rollout of the retailer’s store remodel program.
LogicSource partnered with a leading national retailer to deliver value across Corporate Services, Facilities, Marketing, and Information Technology, which resulted in $11MM in cost reductions in the first year. In addition to the financial benefits, LogicSource provides a centralized buy-desk to drive rate card optimization and tactical sourcing value at the transaction level, contract management technology and support services to drive sourcing compliance and leads the client’s annual procurement summit to identify future CapEx and OpEx profit improvement initiatives.
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.