Background
Pernod Ricard is the second largest alcoholic beverage company in the world experiencing significant year-on-year sales growth in China resulting in ever increasing marketing and promotional budgets. Client was concerned that the spend with external marketing suppliers was not optimized and that world class sourcing practices were not being applied
Approach
- Created multi-functional team with representatives from Marketing and DS buyers
- Selected pilot categories to test opportunity associated with deploying world class sourcing processes (glass and metal products)
- Drove strategic sourcing process on selected pilot categories
- Developed list of qualified suppliers for both technology segments through and RFI process
- Run RFQ process with short listed suppliers to select preferred partners
- Negotiated final frame agreements
- Reviewed current procurement processes, organization and systems
Results
Fundamentally changed sourcing strategy:
– from brand segmentation to technology segmentation
– from « spot » buying to frame contracts
– from « creative agency » to « direct »Negotiated between 30 to 40% cost reduction on pilot categories
Changed sourcing processes and organization
Client decided to outsource the procurement of all its BTL categories to Dragon Sourcing