Savings and Cost Reduction Opportunities
BP Group offers corporations with $1+ billion revenue a no-risk assessment service to develop a cost reduction program (approach, timelines, savings estimates and levers) based on expenditures of externally purchased goods and services.
We will also evaluate and develop customized programs for smaller firms and private equity portfolio companies.
How does it work?
Provide us your most recent 12 months of A/P spend data, in Excel/Access, with line item details (post NDA). We will analyze your data and follow-up with you to identify ongoing or recent initiatives, out-of- scope vendors/categories and other constraints. Then we will make presentation of our preliminary findings. Upon review and your approval we will agree on the next steps, including a Diagnostics engagement.
Final report will include:
- Estimate of your total savings potential across the spend
- Categorization of the spend, along with specific saving levers and “Quick Hits”
- Recommended approach, methodology, governance structures with roles and responsibilities, communication and change management plans
- Cost-effective project plan and roadmap with prioritized category waves to maximize savings in the shortest time span
Hard savings
- Measurable average savings of 10% –30% in reviewed categories, with project ROI greater than 400%
- Significant impact in EBITDA and market cap (magnitude depending on selected categories : OPEX and CAPEX)
Soft savings
- Align procurement with corporate and business operations
- Identify additional (beyond the scope) improvement opportunities
- Develop a cost-effective, efficient and responsive operation
- High quality fulfillment, support and services
- Price and service unbundling and transparency
- Volume and supplier consolidation
- Effective performance measures and monitoring tools (KPIs & SLAs)
- Purchasing Compliance Management
Due to the detailed “deep-dive” nature of the cross-functional analysis, these engagements will typically unravel structural issues (i.e., process, systems, people, controls, policy and procedures).