Case Study: Purchase Cost Saving Project

Case Description: For a commodity business, the raw material pricing constantly saw irregular and high fluctuations, which inflated the cost base and negatively impacted the margin development.

Our Role: We have employed Six Sigma techniques to improve the inbound logistics cost structure, by gaining insights into raw material pricing and enacting the synergy between Purchasing and Logistics. This project enabled commodity managers to utilize the excessive in-house capacity of outbound logistics and renegotiate with suppliers.

Results:  Raw material pricing was much more predictable and experienced fewer disruptions from the logistics component. Targeted and achieved yearly project savings of 100K USD.