How we helped a company with no procurement manager or structured system.
Identifying the Problem
Working with a client with a stock turnover of circa £3million, they had grown in size but with the absence of a procurement manager, procurement was on a job-by-job basis along with ad-hoc orders for stock items. Purchase orders placed based on relationships and not what was best for the company. The processes in place also led to uncertainty as to who placed the order and duplicate orders being placed by members of the same team but working in differing locations. All of this costing time, money and more importantly, stress.
Reaserching the Problem
The first action taken was to review supplier invoices from the previous quarter, identify suppliers and products involved and rationalise product ranges and frequency of orders placed.
Very quickly it was identified that certain stockists were being contacted several times a day and, in some instances, for a single item or what appeared to be a last minute’s requests for ‘stock’ items. Working with the client, we produced a process for materials to be ordered both into stock and for delivery to client sites.
This involved looking at prior year total values, 2021 orderbook to then approach suppliers and manufacturers and invite them to tender for the material supplies. This has benefits throughout the supply chain, not least in providing certainty on volumes but also a guarantee on supply (stock call off).
It was also identified that maintaining a constant stock record on would reduce the time taken for stock take along with more accurate costings of on-going / tendered works.
Twofold: 1) Invitation to existing suppliers to tender for the supply of materials across the clients core range.
2) The introduction of a procurement manager as at the point of writing is being considered with the business case reviewed by the client’s management team.
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