Reducing Off-site Contractors in Latin America

             When I became responsible for all purchases in Latin America I found, together with the Security, Health and Environment areas, that in the Logistics area we had services being provided by 180 different off-site contractors in our region (Latin America), which resulted in high contracting, health and environmental auditing, and control costs.

 Since at the time our suppliers numbered 180, we set out to, together with the Security, Health and Environment, and Operational Logistics areas, develop a strategy to jointly reevaluate all logistics suppliers in our region, and reduce them by 30% in a maximum timeframe of two years (since these suppliers were spread over 11 countries in Latin America).

 After carrying out this joint work with the Purchasing, Security, Health and Environment, and Operational Logistics areas we were able to reduce by 60% the number of off-site contractors, which resulted in an annual savings of US$15,000,000. The number of contracted suppliers for the Latin American region went from 180 to 80, which decreased processing, administrative, financial and contracting costs.

 

to return