Year Over Year Savings Through Product Standardization – By Heidi Humphries, DSSI LLC

As part of its commitment to deliver continuous year over year savings, our DSSI Team presented its long-time client, a multi-billion-dollar automotive supplier, with a great opportunity for product standardization in early 2020 saving them time and money, while delivering the highest levels of support.

Hydraulic oils are products that all manufacturing operations use to some degree to keep their machines running optimally. Many plants will have their preferred brands based on past experience and local representation of the distributor. This particular customer utilized two different types of hydraulic oil across its fourteen U.S. locations in the Midwest, Southeast, Southwest, and West.

Our DSSI Team supporting this client engaged to first understand the current situation including the products being used and what the usage patterns were.

Purchasing Managers then began working with our preferred supplier in the Lubricants category and the supplier’s local reps were asked to work directly with the plants to understand the application and what the proposed products would be.

Once this process was complete, the supplier came back to DSSI and the customer with a proposed standard product that would meet the needs of each of the plants and drive cost savings going forward. Where a new product was being introduced to a plant, time was allotted for testing and analysis to ensure optimal machine operation.

The entire process took about two weeks and generated 42% savings for a total of $90,000 annual savings! This is just one great example of how our customers can depend on DSSI to work collaboratively with suppliers and plants to find the lowest total cost across the entire indirect materials landscape. DSSI works as an extension of its customers’ centralized procurement teams to put in place sustainable cost savings initiatives that act as a foundation for an optimized indirect procurement strategy!

Learn more about how to transform your organization's indirect procurement program with DSSI's full Source-To-Pay process or contact us directly.