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ManufacturingUnreviewed spend

~$50,000/yr

Rigid foam insulation manufacturer

Manufacturing · South Florida

One plant, five categories. Recurring savings on the first pass, with new savings still surfacing three years and one acquisition later.

Client time
A few hours per phase
Upfront
$0
Relationship
2018 to 2021, continued through an acquisition

01

The problem

The plant carried a full book of unaudited indirect spend: merchant processing, energy, freight, telecom, packaging, and copying, all on legacy vendor relationships that had never been benchmarked. Ownership and operations leadership stayed with the work through an acquisition mid-engagement. The review continued under the new corporate parent, with contracts re-audited as they came up for renewal.

02

What we looked at

  • Merchant processing versus market
  • Energy
  • Freight
  • Telecom contracts and unused capacity
  • Packaging materials, priced item by item
  • Copying services

03

What changed

  • Phase I audited five categories in parallel.
  • Merchant processing sat 55 basis points above market and was repriced to interchange-plus.
  • The telecom contract was padded with unused capacity; we rebid and moved to a lower-cost carrier.
  • Packaging was priced item by item. We added competing suppliers to a single-source program.
  • Copying services: we replaced the equipment lease and service agreement.
  • After the ownership change, legacy telecom lines were re-bid.

04

The numbers

Telecom (landlines, internet)
~42% savings

Rebid the account and moved to a lower-cost carrier

Copying services
~24% savings

Replaced the equipment lease and service agreement

Merchant processing
~17% savings

Repriced to interchange-plus with a new processor

Packaging materials
~12% savings

Added competing suppliers to a single-source program

Telecom (year three)
~37% savings

Re-bid legacy lines after the ownership change

Phase I recurring savings
~$50,000/yr
Blended reduction
~17%
5-year value after ERC fees
~$200,000
Year-three telecom re-audit
+$3,000/yr

05

Why it worked

  1. 01

    The audit did not stop at signing

    New categories were audited and old ones re-audited as the business changed hands.

  2. 02

    No operational disruption

    Every switch was a vendor swap, not a process change. Same materials, same output, better pricing.

  3. 03

    The risk-free structure survived new ownership

    The corporate parent kept the relationship because there is no fee unless savings hit the invoice.

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