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Should-Be Cost Model Implementation

Ural 5557

A specialty vehicle and chassis manufacturer had very short lead times for 30% of their non-repetitive spend, leaving no time for competitive sourcing. Buyers were sourcing with no cost information.

Process

  • Using ProcureForce, a multi round market test of 10% of total spend was utilized to gain competitive pricing and true cost breakdown detail.
  • The cost breakdown detail was used to develop ProcureForce should-be cost models for US and Mexico sourcing.
  • ProcureForce enables buyers to quickly benchmark supplier quotes using should be cost models.

Achieved

  • $220k/16% savings