Case Study - Driving Cost Reduction and Efficiencies for an Early Stage Biotechnology Company through Improved SRM and Sourcing Capabilities

Driving Cost Reduction and Efficiencies for an Early Stage Biotechnology Company through Improved SRM and Sourcing Capabilities

Case Study Summary

A development-stage Biotech company had a Procurement staff that was primarily focused on day to day operations. The team lacked strategic sourcing experience and bandwidth to investigate savings opportunities. Vendor awards for key categories had not been reviewed for many years, and the Executive Director of Procurement had concerns about pricing competitiveness. Few supplier management practices were in place; vendor management of laboratory stockrooms was poor, with disorganization and stock-outs affecting scientist productivity. Archstone provided a manager-level resource to work closely with the Executive Director of Procurement and improve processes within the department.

The Client

Biotechnology company.

The Challenge

Identify areas for improvement within Procurement activities; build the team's strategic capabilities; and establish effective and efficient processes.

The Solution

Archstone examined current spend, collaborated with internal stakeholders, developed sourcing strategies, initiated and analyzed RFPs, managed vendor communications, and developed transition plans. The categories sourced included lab, lab equipment MRO, office supplies, shipping, and IT hardware.

The Results

Archstone identified and helped to establish partnerships with new vendors that could drive key benefits to the client - both through savings opportunities and improved operational agreements. In particular, Archstone:

Identified potential savings of 9% in material costs plus rebates and improved SLAs with transition to a new lab supply vendor
Developed a restructured agreement with a new lab equipment vendor to improve cost transparency and data management
Supported smooth transition to new onsite vendors by coordinating inventory audits and updating reporting processes