Procurement Case Study
– Strategic Sourcing Review
– Office supplies

Office supplies procurement review case study

BACKGROUND

Save the Children Australia (SCA) is a Not For Profit (NFP) Charitable organisation with over 70 retail shops & offices plus numerous client programs across all states & territories, including regional sites. The organisation operated under a complex organisational structure, with multiple business streams & state-based teams. There was a formalised sourcing strategy for office supplies, however it was not widely communicated & the preferred supplier was not actively managed. As a result, utilisation was poor, commercial terms were uncompetitive & overall performance was limited. Net zero was an organisational target so SCA wanted to develop a office supplies sourcing strategy that provided the visibility, reporting & supplier support to drive to this goal. The organisation also wanted to align itself with suppliers who have similar principles & demonstrated this in its actions & objectives.

PROJECT OVERVIEW

The strategic sourcing consultants at Spend Solutions were engaged to conduct a retail procurement review of office supplies to deliver a sourcing strategy that optimised commercial terms while meeting the operational needs & strategic objectives of the organisation.

An in-depth analysis was conducted to understand the current state, including identifying legacy suppliers, obtaining usage reports & speaking with key stakeholders to obtain perspectives on current issues & opportunities. A sourcing strategy was then developed & facilitated through a market tender to identify potential suppliers who had the capabilities, commercial positioning & values to support SCA’s organisational & project objectives. Various sourcing scenarios were presented to SCA to allow them to make an informed sourcing decision that balanced organisational objectives with the level of supplier change & potential savings.

PROJECT OUTCOMES

A group wide sourcing strategy allowed SCA to put the foundations in place to meet its organisational objectives, including having consolidated spend with preferred suppliers, centralised contracts, as well as clear performance targets & reporting.

The new sourcing strategy delivered a 19% annualised supplier cost reduction, reduced the number of contracts from 12 to 1, improved commercial & legal terms and identified further opportunities to reduce cost & carbon footprint through product consolidation, preferred product list & minimising delivery frequency.