Pet Food Company Decreases Costs, Increases Buying Power With Supply Tigers Active GPO®
Pet Food Ingredient Supplier
Pet Food Manufacturing
$2M of MRO spend for immediate savings
$300K+ in near term savings
Additional 2% savings with VMI
2 categories sourced
- Power transmission
- General industrial supplies
Implementation of Vendor Managed Inventory (VMI) and Vending programs
Successful collaboration with supplier
A mid-sized pet food ingredient supplier had a change of ownership to a PE firm. Purchasing of maintenance and other operating items was done at each of the company’s six locations with no coordination or leverage.
The company opted against forming a centralized function because they’d need to hire staff. An alternative approach included improving management and visibility of power transmission and general industrial supplies to reduce costs. The company assessed Supply Tigers and a larger GPO. After evaluation, the client selected Supply Tigers Active GPO® to roll their sleeves up and collaborate with the client to maximize results.
Supply Tigers collected spend information and interviewed key stakeholders to understand their current system and processes. Supply Tigers then benchmarked comparable spends with their partner programs and identified several areas of improvement.
Maintenance Repair and Operational Supplies (MRO)
The client was looking to transition to a more qualified and responsive service provider. An inability to meet service levels, organization programs, and competitive pricing led to the decision.
The client’s desires from a supplier were straightforward:
- Significant industry experience
- Responsive service provider
- Identify cost-saving opportunities
- Provide inventory management programs
Supply Tigers has expert advisory services to identify, implement, and maximize every dollar of spend. Not to mention Active GPO® pairs Fortune 500 buying power with business intelligence to streamline and automate procurement.
Programs, like Vendor Managed Inventory (VMI) and Vending, come standard with Supply Tigers. Additionally, compliance monitoring and validation reporting ensure previous service issues were mitigated. Ultimately, Supply Tigers provided the pet food company with continuous improvement solutions that prioritized long-term results.
Supply Tigers immediately applied Active GPO® pricing to $2M of MRO spend. Following the implementation of inventory management programs, power transmission and general industrial supplies had a cost savings of 15%! Active GPO® also provided standardized pricing across all six locations.
Combined, VMI and Vending enhanced the company’s stock-outs, improved inventory turnover, and lowered administrative expenses.
Currently, VMI is a mainstay in half of their locations. The client plans to implement the program in the remaining locations, as well as in start-ups and acquisitions. VMI has contributed an additional 2% savings and has significantly improved collaboration between the supplier and customer.
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