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MRO Case Study – Supplier Consolidation Strategy

Overview

Navigating the aerospace industry’s procurement networks in this era of competition among global supply chains could be difficult. The success of an effective procurement strategy is increasingly dependent on the skillful ability to integrate multiple supplier networks for deeper everyday business relationships.

One of our MRO customers came to us with specific obstacles they needed to solve: they were looking for a partner that could consolidate similar, intersecting, or overlapping suppliers; simplify and centralize automated purchasing procedures with the existing digital purchasing platform; increase procurement speed & flexibility and ensure product quality.

Approach

Proponent teamed up with our MRO customer to prioritize reducing vendors with supplier consolidation strategies in mind to meet our MRO customer’s procurement operational needs. We developed strategic plan focused on critical benefits from quality increments and improved quality-control innovations to meet industry standards and a much smoother procurement-procedure flow with data-driven KPIs.

Challenge

Global supplier networks consolidation:

The key responsibility is to ensure close coordination and collaboration with contracted suppliers and that all service agreements are met
Reduce risk and improve supplier relationships

Increase procurement speed and flexibility, and ensure product quality:

Enhance real-time digital RFQ and purchasing platform connectivity
Meet industry compliance requirements and eliminate difficult and complex tasks with various global suppliers

Reduced purchasing costs:

Target high-volume suppliers for both short-term financial benefits and long-term financial advantages without overcomplicating any procedure

Results

Vendor Reduction

Reduced suppliers base and aimed for purchasing power increased by working with core strategic supplier partners

Cost Reduction

Allocated more resources to fewer suppliers since our MRO customer began to receive better pricing

The targeted frequency and velocity reduced freight costs, handling, and other related fees

New Opportunity with OEM

Worked with Proponent OEM partners to meet regulatory requirements of manufacturing standards in potential areas of improvement

Streamline Procurement Procedure

Executed new procedures with renovated real-time digital connectivity on product information, stock availability, and inventory levels

Conclusion

With Proponent’s 50 years of experience in global supplier networks management, we were able to leverage our supplier relationships to achieve the MRO customers goal and establish trusting partnership. Our solutions are concentrated on reducing our MRO’s procurement supply chain costs and improving their bottom-line efficiency. Working strategically with our MRO customer, Proponent has successfully delivered new growth opportunities for our MRO customer.