Indirect Category Expansion - A CoVest Case Study

Posted by CovestAdmin on Nov 18, 2014 9:35:39 AM

Mission: Assist member in the creation of centralized contracts for additional categories. 

A current CoVest member has already tackled some of the more straightforward categories in their path towards centralized procurement. Their next goal is to expand their indirect categories and drive compliance. 


Working with the member and their suppliers, CoVest obtained a deep understanding of the business's needs beyond simple price savings. The sourcing network aimed to ensure a strong fit from the inception of the contract. This was accomplished through the engagement of many internal stakeholders after CoVest had gone through the benchmarking process and determined that sufficient savings was on the table to warrant the effort. 

The categories included bearings and power transmission, electrical supplies, industrial supplies (MRO) and temporary labor. 

CoVest analyzed each category individually with our supplier partners. Each individual category took somewhere between 3 to 6 months to complete. In the end, each of the categories drove savings of over $4 million. Compliance to the centralized contracts increased dramatically as part of the effort. 


Click below to download a PDF of the case study: 

case study indirect expansion

Image provided by Flickr user: KenTeegardin 

Topics: Educational

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