CASE STUDY

Spend Management Assists A Prominent Transportation Services Provider to Develop A Strategic Procurement Strategy

Apr 4, 2018

Overview of the Transportation Services Industry

The global transportation services industry includes several sub-sectors including subways, municipal buses, goods transport systems, and other similar modes of transport. The industry encompasses all those businesses that move people or goods, by land, sea, or air, from one point to another. The transportation services industry is capital-intensive, and the demand is primarily driven by macroeconomic trends in global imports and exports. request free proposalAdditionally, the intensity of competition fluctuates depending on the specific industry; the road transport sector for instance, usually experiences the highest level of rivalry, while railways, as natural monopolies, suffer less from direct competition. As a result, leading players operating in the transportation services space are looking at expanding their business units to establish their presence in the market.

However, our analysis of the logistics industry shows that the leading transportation services providers are facing challenges in terms of:

  • Economic factors: Transportation projects across the globe may have an adverse impact on the community’s economic development objectives including business activity, employment, property values, productivity, and investments. The chief aim of such projects revolves around improving the overall accessibility while reducing transportation costs. Therefore, it becomes necessary for firms in the transportation services space to consider both the positive and negative impacts of economic factors.
  • Civic impacts: These include the effects of a transportation project on communities beyond specific factors that unpleasantly affect the users of transportation services. It is also known as ‘social impacts’ and includes variations in environments, noise, views, and land use mix and community cohesion. Additionally, community impacts serve as a significant decision factor when transportation services providers are weighing both the distributional and adverse effects of proposed projects.

Several such factors are compelling transportation services providers to leverage the use of robust spend management solutions. Spend management solutions help firms efficiently manage their organizational spend and identify critical savings opportunities to reduce maverick spend. These solutions also help companies effectively monitor their spend and gain better visibility into the spend performance.

The Business Challenge and Journey

Client background: A leading transportation services provider with business units spread across the globe wanted to streamline their business practices and analyze their current, past, and forecasted expenditures to allow visibility of data, based on commodities.

Client issue: The client wanted their entire process of spend management including data extraction, classification, and analysis to be reinforced by automation, thereby, making it a sustainable process. The client also wanted to implement a robust spend management solution to reduce their overall material and service costs.

The spend management experts at SpendEdge carried out extensive research comprising interviews and discussions with prominent stakeholders in the transportation services sector to help the client develop a strategic procurement strategy. The experts also compiled information across a wide array of reliable sources such as trade shows, company presentations, industry forums.

Client journey: During the course of this spend management engagement, the transportation services provider was able to identify the opportunities to improve operational performance and buying power, reduce costs, and provide better management and oversight of suppliers while strengthening relationships with the internal and external stakeholders.

Key questions answered in this spend management engagement

TS2The Results

SpendEdge’s spend management solution offered the transportation services provider gain actionable insights on the organization’s overall spend data across the logistics Industry. The client also improved their spend visibility and increased their compliance with procurement policies. This helped them reduce their overall spend by ~74%.

To know more about our spend management solutions

request free proposal


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