Cost Optimization – how to get a FRESH START

Companies should re-evaluate their cost structures in the context of the current economic situation and make use of professional measures to reduce costs in procurement. We explain how this works in practice.

 

  • Reducing costs in Procurement in four steps
  • Demand & Budget Management: How to avoid unnecessary expenses
  • Conclusion and recommendation for action

 

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Those who act now can thrive in the long run


Politicians and thought leaders have been preaching it for a while: after the pandemic, the economy needs a fresh start. The first virtual World Economic Forum being held under the title “The Great Reset” is an example of this. But the new start can only succeed if companies set out sustainable cost management measures. A tour de force that the future of many companies rests on.

The pictures that went viral around the world were astonishing yet frightening at the same time.

Planes parked in hangars or on the tarmac. Freight trains halted at stations. And from a bird’s eye view, the world’s oceans looked in some places like a game of Battleships: row upon row of them, anchored in ports across this planet.

Reducing costs in Procurement: EMERGING stronger from the crisis

The months of standstill and lockdown have led to some bizarre situations. What can an airline do if it is not allowed to fly? What can a factory do if it cannot produce anything because it is missing parts that it normally sources from all over the world? What can a restaurant do if no guests are allowed to dine? For many companies, this phase has been an economic disaster. For others, it has meant watching from the sidelines, hoping that their industry will not be impacted next. In either case, it is now as important as ever for companies to streamline their operations and drastically cut costs to protect turnover as well as margins.

  • Step 1: Determine and leverage your own position
  • Step 2: Managing demand and implementing immediate measuresn
  • Step 3: Managing demand and implementing immediate measures
  • Step 4: Optimizing costs throughout the supply chain in the long-term

Read the detailed description of the 4 steps in the digital edition of our magazine.

Inflation in Procurement

Procurement teams with the knowledge of all of its cost drivers will find that not every increase is justified. This makes it possible to fend off price increases and look to adapt commercial models to ensure fairness for both sides when commodities start cooling off. – Thibault Lecat, Managing Director and System Leader LAB&F, INVERTO – BCG Company

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Our cost optimization experts

Markus Bergauer

Managing Director

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Marcus Schwarz

Managing Director

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Our cost optimization insights

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