CASE STUDY

SpendEdge’s Spend Analysis Assists a Renowned Reverse Logistics Provider Achieve Substantial Savings by 15%

Feb 24, 2018

Overview of the logistics industry

In the recent years, the logistics industry is witnessing robust challenges in terms of high operation costs, low margins, and a shortage of talent. To address these challenges, prominent organizations are planning to streamline their service capabilities to improve delivery performance and increase customer satisfaction levels. With the rising demand for one-stop solutions, businesses are entering mergers and acquisitions to tap potential markets and enhance their functional capabilities. Moreover, the growth of reversed logistics space can be attributed to factors such as robust GDP growth, globalization, and increasing foreign direct investment.

Some of the factors curtailing the growth of the reverse logistics space are:

  • Tracking warranty: As reverse logistics involves the process of replacing commodities directly from the customers, it becomes difficult for the companies to track the warranty of the products. In the case of third party repair by an OEM, it becomes essential for businesses to track those secondary warranties and generate appropriate claims for the warranty service offered.
  • Improving efficiency: As the reverse logistics space is witnessing relentless competition with the presence of a considerable number of competitors, it becomes essential for the businesses to leverage technological capabilities to streamline their work and deliver efficiency. With the help of advanced software, the company at large can become much more productive and offer seamless and reliable services to the customers.

The Business Challenge and Our Journey

The client, a renowned reverse logistics provider, wanted to accurately classify the spend and gain better visibility into their overall process. With the help of industry best practices, the client wanted to efficiently streamline their process to identify critical savings opportunities in an easy manner. Moreover, through a robust spend analysis solution, the client further wanted to gain accurate, consistent and timely insights into the spend and accelerate their decision-making process.

To identify and calculate the market trends of commodities, the procurement experts at SpendEdge carried out extensive research comprising interviews and discussions with prominent stakeholders in the reverse logistics space. To identify the potential bottlenecks, the experts also compiled information across a wide array of reliable sources trade shows, industry forums, and company presentations.

The spend analysis solution offered by SpendEdge assisted the reverse logistics provider to compare the spend with that of the industry peers and gain substantial savings. Moreover, the solution also helped the client identify bottlenecks in terms of fraud and non-complaint activity and prioritize savings opportunities.

Fundamental questions answered in this spend analysis solution include:

Sp- spend analysis


The Results

During the course of the engagement, the reverse logistics service provider was able to identify and prioritize sourcing opportunities and devise an effective spend management strategy. In addition, with the help of the spend analysis solution, businesses leaders can monitor performance on the KPI’s and gain granular insights into the spending trends and buying activities. The solution also helped the reverse logistics client understand the products specification including the quality, availability, and service requirements.

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