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User supplier rationalisation
to structure your supplier portfolio

On average, supplier management costs are estimated to be €1,000 per supplier per year, depending on the sector. However, long tail spend accounts for 75% of the number of suppliers, with costs impacting business profitability. Reducing the number of suppliers is therefore a high-impact lever for generating savings.

Distribution of the number of suppliers by type of purchase

Distribution of the number of suppliers by type of purchase
Depending on the type and size of organisations, this represents hundreds or even thousands of suppliers, often for exclusively local use, or a few annual transactions. And that's without taking into account the share of purchases made from non-referenced suppliers!

Example of supplier classification

Example of supplier classification
This multitude of suppliers represents not only significant administrative costs, but also a considerable workload for the teams (orders of a single line multiplied, search and referencing of suppliers, etc.). As such, the fragmentation and size of the supplier base is often one of the biggest issues for specialty buyers on long tail spend.

3 objectives of supplier rationalisation

Economies

Cost savings

By reducing the management costs of your supplier portfolio and the number of orders.

Productivité

Increased productivity

By reducing the number of low value-added tasks (supplier negotiations, supplier database management, orders, deliveries, invoices).

Gain de temps

Time savings

By relying on Manutan’s experts to find and analyse the products you use, and by grouping orders and deliveries.

Supplier rationalisation in action

Pharmaceutical industry company

Number of employees: 8 000
Supplier spend per year: €800,000
Number of orders per year: 2,700

Our tailored action plan

  • 20 suppliers replaced with Manutan, whose range includes similar or equivalent products
  • Supplier management costs per year per supplier: €1,800

Result:

€36,000 IN SAVINGS
by eliminating the management costs of 20 supplier accounts.