The aerospace sector right now is in unprecedented territory due to Covid-19 and the impact of reduced air travelling is rippling right through the supply chain.
The OEMs and Primes have taken on huge debts which will need to be serviced, and as part of huge cost cutting measures large redundancies are unfortunately looming. But that alone will create the headroom they need to reduce costs.
They have already reduced all but non-essential travel, contractors and consultancy support switched off and R&D programmes rescheduled or shelved.
But they need their supply chain to support their cost reduction programme, and the clear expectancy will be to reduce pricing. More collaborative measures may yield greater results, but their approach is likely to be aggressive.
The strain on you is therefore significant, and with tight margins squeezed or eroded and the looming threat of losing a significant customer you need to do something different.
You therefore have no option to reduce your own costs, and yes whilst industry needs to review how it interfaces the many quality requirements this is not going to help you right now.
What you need is a clear cost reduction roadmap which can support your own business and in-turn your customers. But this must be a strategic approach, and reviews in detail the options you have to reduce your own spend and costs.
Our free offer of help is to create that cost reduction roadmap by reviewing your spend and procurement data. We don't need much data, but we can use our software to turn your spreadsheets and reports into something that you can instantly see.
Our procurement expertise will enable us to provide you with the insights your data provides which will form a clear strategy on how you can reduce spend and cost.
The procurement analytics will highlight where you are haemorrhaging costs.
How to better leverage spend
Inefficiencies within your own purchasing processes
Exchange rate exposure
Supplier spend by region/country
Which suppliers you need to collaborate with
Targeted cost reduction opportunities
And as a final thought, if you do not have commercial contracts in place with your suppliers then you have no foundation for a collaborative relationship and certainly not optimal pricing.
Our target will be to provide you with a roadmap of hidden opportunities that can reduce your costs by at least 5%. We have delivered in excess of 30% in some categories of spend for customers.
And just recently we have supported a customer to improve their cost savings performance from just £25k to £450k, with a pipeline of £750k in place, just by taking this approach to data.
What impact would that have on your business??
Contact us now to enjoy the benefits of our offer of support and give yourselves the opportunity to improve your competitive advantage!
Call 0330 311 2601