Direct Materials

We go beyond short-term savings but help your company balance between price, service, risk and quality

Direct materials spend makes up a significant component of product Cost of Goods Sold (COGS) and very often in excess of 50% of the product cost.  For companies to remain or be competitive, it will need to look for ways to reduce material costs to have enormous impact to the company bottom-line.  Manufacturers that struggle with controlling material spends will eventually be forced out of competition.
Our service promise goes beyond short-term savings but a balance between price, service, risk and quality. Our scope includes but not limited to the following:

  • Analysis and categorise Direct Material Spend
  • Benchmarking of purchase
  • New Product Sourcing – support sourcing of new parts to meet your product COGS
  • BOM Cost reduction
  • Supplier Qualification Services
  • Low Cost Country Sourcing
  • Outsourcing of Higher Level Assemblies
  • Engineering Out High Material Costs

Some of the categories that we have successes with include cable harness, sheetmetal, machining, castings, plastic injection molding, packaging, fasteners, LCDs, power supply, motors, PCB, PCBA etc

Indirect Materials

We will help customer to analyze their spend and identify cost savings  opportunities and address the often highly fragmented spend

Indirect costs are incurred throughout the business life cycle and not unusual to constitute more than 50% of the organizations spend.  Unlike direct spend which is constantly under scrutiny, indirect spend in most organization are diamonds in the rough when it comes to cost savings.  Unlike direct materials that are linked to Bill of Materials (BOMs), indirect purchasing very often is without proper procedures that encourage sporadic buying by the various stakeholders.  The result is highly fragmented spend; lack of transparency and often a long tail of spend that has not been addressed.
Our consultant engagement with suppliers / customers includes but not limited to the following:

  • Conduct and validate accurate spend analyses
  • Establish visibility into indirect spend programs
  • Conduct negotiations with suppliers
  • Manage the RFx processes (e.g. Requests For Information and Quotations)
  • Identify opportunities and design short/ long term strategy to achieve cost savings

We have Category expertise in Travel, Utilities, IT&T, Office products, Lab supplies, Facilities services and professional services such as HR, Finance, Marketing, Logistics