Should-Be Cost Model Implementation

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