Business Cost Analysis
& Strategic Cost Reduction
In November 2018, Denham Procurement & Sourcing Solutions were successful in securing a contract with a large FTSE 100 infrastructure company to deliver a £2m cost reduction programme in one of their Rail businesses.
In conjunction with their senior management team, we reviewed the £17m annual spend of the business and agreed a strategy to reduce supplier spend across a number of key spend areas to include fleet, travel, fuel, waste, machine parts and consumables.
The cost reduction strategy was a blend of supplier contract re-negotiation and supply chain management, demand reduction, process improvement and introduction of new suppliers.
In the Fleet category, Denham Procurement & Sourcing Solutions aided this key client in reducing annual spend on fleet by in excess of £500,000. This was a mixture of demand management – reducing the fleet size by in excess of 10%, fleet standardisation and contract negotiation.
Since completing the assignment in June 2019, Denham Procurement & Sourcing Solutions have been recommended to two other divisions of this infrastructure business and are currently working on a business cost reduction programme for a further £37m of annual spend.
Our customer said
“Great work Simon. I have spoken to our MD about the work you have done. He wants me to introduce you to the MD of Gas & Water and the FD of Power Transmission & Distribution”.