Case Studies

Private Sector - Construction

Increasing overhead efficiency and cost reduction

Group purchasing agreements were considerably enhanced for Westbury Plc through improving process efficiency and instigating online order systems.

Westbury plc was a FTSE250 construction company operating throughout England and Wales, well respected for its innovative approach and leading product designs.

Traditionally group purchasing agreements had been established very effectively for all categories of building materials and excellent relationships had been forged with suppliers, who became true business partners.

The Board had set objectives of improving business efficiency and reducing cost levels. We therefore established a team comprising Group Finance Director, nine regional Finance Directors, Group Services Director, Group Supply Chain Manager and a number of existing suppliers, to investigate a number of overhead areas and establish group purchasing agreements.

The overhead areas were selected based on maximum business impact and potential suppliers were contacted. Reviews were undertaken, proposals presented and where appropriate new suppliers were introduced. The changeover was carefully managed to ensure quality of product and service was continued, and in many cases this was improved.

Throughout this change project, opportunities for improving process efficiency were actively sought and where suppliers offered on-line ordering systems these were implemented.

The areas of expenditure reviewed totalled in excess of £12m annual spend and the cost reductions achieved were £3m per annum.

“The move to establishing group purchasing agreements for overhead areas was challenging but the benefits significant enough to follow the change through to effective completion.”

Martin Bevan, Group Supply Chain Manager – Westbury plc 2005