ICG Commerce services seal savings and procurement efficiency for consumer packaging manufacturer

Situation:

Procurement of MRO supplies, packaging and process chemicals by a $1B manufacturer of consumer packaging products was being performed individually at 17 different facilities using manual processes. With mounting pressure to reduce costs, the company wanted to centralize, automate and streamline purchasing while achieving price consistency and 10% cost savings across all locations. The company's small corporate procurement organization knew that to be successful they needed the plant's to approve and use new national preferred supplier agreements and to be able to drive efficiencies by automating their purchase to pay process.

Solution:

To give the company a clear picture of its indirect purchasing, ICG Commerce first fully assessed indirect spend at each plant location. Upon identifying categories with the greatest initial savings opportunities, ICG Commerce professionals developed and implemented an e-procurement solution at all 17 facilities which leveraged pre-sourced supplier agreements for online purchasing of indirect supplies at optimal prices negotiated by ICG Commerce. ICG Commerce and corporate procurement worked closely with each plant to ensure the resulting agreements met their needs, suppliers were trained and ready to receive and fulfill orders, plant personnel were trained on the new procurement system and savings tracking reports had been implemented. At the same time, ICG Commerce integrated the e-procurement system with the company's existing JD Edwards (JDE) purchasing software, effectively streamlining the MRO purchasing process with content syndicated to JDE item masters and ordering through EDI purchase orders.

Results:

ICG Commerce had the e-procurement solution up and running at all 17 facilities within 9 weeks. Both the purchasing process and supply base have been significantly streamlined, and the combination of online buying efficiency and ICG Commerce-negotiated pricing has yielded 10.9% average unit cost savings. The company achieved over 80% adoption in less than one year, resulting in $3.5M in realized, bottom-line savings.