Fortune 500 Packaging Manufacturer: ICG Commerce delivers greater purchasing efficiency and savings in industrial packaging operation

Situation:

The purchasing department of a $7.7B industrial packaging company was manually processing stacks of requisitions from 70 facilities, expending considerable time and tying up already limited resources. With tightening margins in their industry, the company needed to identify and implement savings across a wide range of purchasing categories. Additionally, the company wanted a way to enforce compliance against preferred supplier agreements while automating the manual functions of its purchasing and payment processes at the individual facilities.

Solution:

Combining extensive sourcing and category expertise and leading technology, ICG Commerce professionals facilitated implementation of web-based purchasing in 5 indirect categories: office, mill and electrical supplies; air filters/HVAC; and power transmission/bearings (PTB). Private e-catalogs for these categories were built in 8-10 weeks, containing pre-sourced items at optimal prices negotiated by ICG Commerce. Approval and payment processes were also streamlined through use of consolidated electronic invoices for multiple suppliers.

To ensure adoption and smooth transition to online purchasing, ICG Commerce trained 200 users in the process and provided change management support across all 70 plant sites. In addition, ICG Commerce sourcing and category experts provided strategic sourcing services in several direct categories, including chemicals and finishing supplies.

Results:

Within 9 months, 100% of the buyers at the company's plants were using the web-based purchasing process, and the company realized 12-23% savings on $156M indirect spend. Another 9-15% savings were also generated in the direct categories sourced by ICG Commerce. With these procurement cost reductions, ROI was achieved in 90 days.