PURCHASING EFFICIENCY Improve company profits via a margin contribution derived from the overall cost of processes in which purchasing is involved. EXAMPLE A major European energy supplier THE CLIENT The client, an energy supplier for more than 30 million households, wanted to carry out an international benchmarking exercise on the overall "meter" cost (purchase, use, maintenance, invoicing, damage, etc.) and improve purchasing performance (1 million meters per year). RESULTS The benchmark highlighted significant potential savings. Savings of 48% were obtained on the purchase cost (value analysis, functional analysis, supply chain, etc.) by rethinking the buying strategy and the methods used to solicit the supplier markets. In the second phase, an in-depth study of the measurement process showed that a technology change (from electromechanical to electronic) would lead to a reduction in the overall process cost. These savings – 20 times the purchasing cost – are such that the cost of replacing 30 million meters would be paid for in 4 years. Moreover, in addition to these direct savings, the company was in a position to offer value-added services in the area of domotics, thus putting our client in the forefront in Europe.