RFP process - Middle Eastern client with a large quick service restaurant chain.
Client overview: Middle Eastern client with a large quick-service restaurant chain.
Background: Following the spend analysis review, re-organising the categories provided A&C with the visibility to see where the opportunities for better cost management lay.
Objective: To not simply avoid or reduce annual fee increases and consider a static price to be a money saved, but to reduce the cost of supplies.
Work Done: We started with one core ingredient of the chain’s biggest selling dish – in this instance Tortillas.
We created a baseline with the incumbent’s cost per case, quantity per case and subsequent cost per Tortilla for all sizes used. We also factored in the company’s projected growth for the following year to generate an estimated annual requirement figure for the following year, this gave us a benchmark with which to go to market.
Our team then researched global suppliers of tortillas into the country and reached out to their sales force for global export.
We selected a Request for Proposal as the most effective way to manage and open up the category to alternative companies. Our administrative team created an RFP sheet detailing company information including values and mission statement, specifications on-site locations and of course size and quality of the product. Sheets were added to detail specific terms required for a supply contract and offering options to add value for volume discounts and contract length incentives.
This was issued to a total of 8 suppliers including the incumbent, inviting them to tender on specific criteria including container load information, brochures, product specifications and any further information for quality and hygiene certification.
These were then reduced to a shortlist, the final 3 of whom were asked to send samples to the Middle East office so that our consultants and the client’s leadership team could compare the best of the shortlist.
Result: We did not ultimately select simply the cheapest supplier, we also factored in quality and reliability, the outcome was that the client found a more cost-efficient supply chain solution from their existing supplier and their annual spend on one product alone was over US$650,000.