€61,500 Direct Savings by Adjusting the Courier, Bag and Postal Services
Despite understanding a priori that there was no room for improvement, a detailed analysis of the consumption patterns of shipments over a year and a focus on real needs have provided dozens of small adjustments that offer an extra €61,500 in savings to a customer of the insurance industry.
In an established market such as courier and postal mail, customers believe, if they do not want to take more risks than necessary, that they are reaching their optimal cost. When you have large contracts renegotiated by the European parent company and your leadership in the insurance sector does not allow you to further adjust the level of service offered to your more than 25 offices and thousands of clients, the room for maneuver is minimal.
When planning the project, Lean Focus focused on ensuring the proper use of the different courier and postal services, without reducing the number of shipments. After carefully analyzing the shipments made in a year, establishing consumption patterns and identifying the different needs, work has been done to find the most appropriate solution for each of them.
For this reason, the development of the supplier strategy, support in the negotiation to improve current contracts, optimization of service schedules according to need and cost, the assignment of suppliers according to the delivery profile and advice on actions aimed at saving and Efficient use of the different services in each of the offices has been key to the success of the project.
At the start, there were framework contracts, some covered by a corporate contract, and application procedures for each of the offices. After an analysis of the sending patterns of the different offices, it was observed, to everyone’s surprise, significant differences in the services used.
In Postal Services, after analyzing the needs and current use in detail, the collection days have been adjusted to the needs of each office and certain criteria have been adjusted when choosing the services. At the same time, the envelopes have been adjusted with the aim of facilitating the tasks of Postal Service providers and having negotiating arguments, which has provided €40,000 in savings.
In Messaging Services, the project has encompassed national, international and local messaging. In national courier services, the processes for choosing the different delivery services offered by the provider have been redefined, communication between the different offices has been reinforced and the different discrepancies and exceptions that existed in some offices to date have been managed. These changes in national messaging, together with adjustments in local and international messaging have provided €13,300 in savings.
In reference to the Bag Service, an extensive sample of shipments between offices has been analyzed, including the kilos transported daily, to readjust the frequencies according to the needs of each office, delivery times and size of the bags. The savings achieved, without impacting the service needed with these changes and the negotiation of the rates, have given the client an additional €8,200 in savings.
Once this first phase is closed, where dozens of small adjustments provide us with considerable savings while maintaining the same traffic, we want to give the project a new twist. Knowing exactly the different casuistry of shipments, we want to use the facilities provided by new technologies to reduce the number of shipments. Here the savings could be greater, but we will discuss that in due course.