Procurement
Case Study: The procurement
director for a large manufacturer of pipes faces a significant challenge due to a force
majeure event that has disrupted the supply of PVC resin from their primary supplier.
This disruption is expected to last for three months, creating an urgent need to source
materials from alternative suppliers to maintain production continuity.
Key Challenges
- Immediate Material Shortage: The manufacturer needs a steady supply
of PVC resin to continue production without interruption.
- Finding Alternative Suppliers: Identifying reliable alternative
suppliers who can meet the volume and quality requirements.
- Spot Market Sourcing: Navigating the spot market for immediate
procurement, often at higher prices.
- Negotiation and Terms: Securing favorable terms amidst potentially
higher costs and limited availability.
Solution: Our CSM+ chemicals
package helps the procurement director:
- Access to Platts price assessments to understand current price levels and as the
basis for contracting
- Understand the price outlook for 12-24 months ahead to support budgeting
- Understand capacity utilization levels for the product they need to procure
- Keep on top of supply chain disruptions
- Identify potential alternative suppliers
- Understand current market conditions to inform timing of purchase
- Understand the marginal economics of potential suppliers and competing buyers before
commencing negotiations
How our Solution Helps
- Effective negations can result in cost saving and supply security
- Understand current market conditions to inform timing of purchase
- Source chemical raw materials
- Maintain security of supply
- Optimize supplier portfolio
- Make informed buying decisions and negotiate effective supply contracts at the right
price
- “Beat the market”
- Explain price fluctuations to senior management
Workflow Solutions:
- Chemicals Enhanced Analysis & Forecasts provides a single view of PVC price assessments, price forecasts and capacity utilization. Data can be downloaded for further analysis
- Directory of Chemicals Producers alternative suppliers can be identified
- Chemicals Cost & Margin Analytics (CCMA) provides an understanding of marginal economics to understand the likely floor & ceiling price for negotiation
