Optimizing Sourcing, Construction, and Cost Reduction of Millions (CS286)

Written by Maine Pointe | Jun 27, 2023 6:01:43 PM

This story is for CEOs who:

Are concerned about the costs of expansion
Have a supply chain that has not kept pace with the company’s growth
Need a better understanding of and control over costing and development cycles

The Challenge

What started out as a personal hobby turned into a chain of over 60 barbeque joints in 8 states, with the goal of doubling that number. That fast growth in joints left the company with entrepreneur-level procurement and construction processes and tools. Pandemic supply chain issues caused skyrocketing costs and major construction delays, affecting revenue. At the same time, a long-term distributor contract locked the company into less than optimal costs for their main food ingredients.

Bringing visibility into the end-to-end construction supply chain to control direct and indirect costs

SGS Maine Pointe:

Traced the critical path for roll-outs and gave the company greater scalability and certainty over construction
Reduced direct and indirect material costs
Improved access to data with new scheduling and costing tools that opened visibility into spend
Created dashboards based on KPIs and data analytics that provided a single source of truth
Initiated a procurement management operating (PMOS) system that matured the procurement department and raised its ability to control costs

Lessons learned for other executives

The control of spend begins with trustworthy data and the right tools to create visibility
Creative strategic procurement techniques can ameliorate bad contracts
The processes that worked in the past are not necessarily the ones that will open up the future

The Results

8% savings in development
10% reduction in build-out cycle
11% reduction in cost-of-goods sold
Improved visibility into a complex construction supply chain
Improved company’s competitive position
Built procurement management operating system (PMOS)

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