Challenge
A leading logistics group was undergoing a strategic review aimed at transforming its business through a series of efficiency and performance initiatives. One critical area of focus was third-party expenditure, a significant cost base where the client believed untapped opportunities for cost reduction and efficiency improvement existed. However, the group’s structure posed a challenge. Operating as a conglomerate of companies, each business unit used different accounting systems. This fragmentation meant the organization lacked a consolidated view of its total third-party spend, making it challenging to identify where savings and efficiencies could be found.
The client appointed our team to bring clarity, consolidate data, and deliver a structured opportunity assessment across its spend portfolio.
Approach
A structured spend and opportunity analysis was designed, focusing on turning fragmented data into actionable insights.
Our approach included:
- Spend segmentation – Analyzed third-party spend across the group and categorized it into non-addressable, addressable, and influenceable spend.
- Opportunity identification – Deep-dived into the influenceable spend by category and subcategory, identifying opportunities for cost reduction, efficiency improvements, and better working capital management.
- Contract review – Assessed and critiqued existing supplier contracts, highlighting areas for improvement and potential renegotiation.
- Category analysis – Conducted detailed reviews of current category performance and supply markets to uncover procurement opportunities.
- Wave plan design – Prioritized initiatives by potential benefit and ease of implementation, creating a structured roadmap for delivery.
This combination of data-driven insight and procurement expertise gave the client the clarity it needed to target savings effectively.
Results
The spend analysis delivered a clear and actionable view of opportunities across the group:
- Over 30 opportunities identified across 16 categories.
- $13.5m in estimated savings through cost reductions, process efficiencies, and working capital improvements.
- A consolidated view of spend by category, business unit, supplier, and geography.
- A prioritized wave plan provided the client with a roadmap to realize benefits.
By shining a light on fragmented spend and identifying a clear portfolio of savings opportunities, the client had both the insight and the tools to act.
The analysis enabled the logistics group to:
- Consolidate spend visibility across multiple business units.
- Target high-value savings opportunities with confidence.
- Improve procurement efficiency and contract management.
- Build a clear roadmap for transformation that is aligned with strategic priorities.
A structured and transparent approach not only revealed huge savings but also created a foundation for the client to embed procurement discipline and deliver lasting performance improvements.
This project was delivered by Proxima’s APAC team, under the former brand name, ArcBlue.
