Cost reduction and Procurement

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Introduction

The prolonged economic crisis and uncertainty over the immediate future is making many companies seek opportunities for profit recovery within their organisation . After carrying out the normal action, the possibility of more complex opportunities involving transformation may be explored.

At PwC we have professionals who are experts in different business areas, practically in all sectors of activity, who are capable of identifying, designing and implementing the measures that permit companies to carry out the transformation necessary to optimise their costs. Our approach permits companies to substantially reduce their costs whilst providing them with a structure/organisation that permits sustaining those savings over time.

Specifically, we offer an expert solution of reducing purchase costs.

Potential problems

A situation of cost reduction includes :

  • Overmanned back-office functions (administrative – financial, HR, Purchases, General Services …) far from the optimal size.
  • Geographically dispersed services and business support structures that generate duplicity and inefficiency.
  • Non-optimised purchases in different expense categories (general and technical purchases ): duplicity in management responsibilities, absence of procedularized processes, especially in the approval and selection of suppliers.

How we can help

  • Pre-evaluation of possible savings, as a result of comparing customer practices vs. best practices by PwC experts in functional areas : identification of opportunities.
  • We review the support organisation of companies to identify optimal sizing and organisation.
  • We consider alternatives for improvement and conduct a business case analysis for each of those alternatives.
  • We analyse and advice on the purchase strategy approach of families, to review specifications, policies and demand management and maximise the opportunities offered by the market.
  • Methodologically our work is carried out in three stages : diagnosis, design and plan for implementing the savings program.

Look at Strategy & Operations Solutions