Planned and Unplanned Presentation (1)

Get Out From Under Your OverheadEfficiency, Simplicity and

Consolidate

Reducing Timeand

Lowering Total Cost in the Business Supplies Procurement Process

Reduce Overhead by Minimizing Purchases Orders

In an increasingly competitive global environment, organizations must innovate to find opportunities to improve their productivity and reduce total cost.

Initiatives that consider all aspects of process improvement and purchase order reduction will find the greatest level of success in improving efficiency.

AMERICAN’S SOLUTION

More Than A Business Solution. Your Partner.

AMERICAN INK SOLUTIONS INC.

AMERICAN MAILING SOLUTIONS INC.AMERICAN PRINTING SOLUTIONS INC.

AMERICAN SHIPPING SOLUTIONS INC.

Direct and Indirect Materials used to support the…

What is ORAD?

…of activities in a business enterprise.

Origination

Replication

Administration

Distribution

Controlling the Flow of Communication

Recognizing Indirect Materials (ORAD) purchase behaviorsand the cost of the Planned and Unplanned

Strategies for Saving –

– Supplier Consolidation– Product Standardization– Inventory Reduction / Workplace Organization

Discussion Topics

Cross Referencing

You Face Many Challenges Daily…

Technical Support

Production Line Issues

Repair PartsEmployee Satisfaction

Cash FlowFreight Ordering

ProductivityImprovements

Budget Cuts

Hard to Find Item

Inventory Level

Supplier out of Stock

Inventory

Delivery TimesAvailability

Most Unplanned Purchases Are Non-Routine

Less Than 5 Times Per Year: A search every time you purchase

Research Results

80%

60%

40%

20%

0%

100%

Unique itemspurchased Year 1

Items repurchasedin Year 2

% of unique items

70-75% Of Unplanned Purchases Are Unique, One-Time Purchases

Process Costs Can Be More Than Price of Product

The Opportunity For Savings Is In The Process

$117 $100100%

80%

60%

40%

20%

0%

Process Cost

Process Costs$100

Inventory

Selection and ordering

Receipt and payment

Price of Product$17

Meeting Unplanned Needs Can be a Long and Costly Process

Managing a crowded supply chain is expensive

All ORADpurchases

All Suppliers

Maximize E-channels

CONTINUUM• Complex, fast-changing environment• Adoption is difficult• Engage different e-channels: one size does not fit

all purchasing situations

INTEGRATEDERP SYSTEM

ELECTRONICMARKETPLACE

EDI INTERNET

FIELDNAMES:SupplierID Supplier PartID ItemDescription UN/SPSCCode UnitPrice

005103494-t 1AH87 "RatchetAdapterFor3/8InchDrive1-5/16InchesLength" 27111700 0.00005103494-t 1AM25 "PushbuttonRoundHeadRatchetFor1/2InchDriveChrome16InchesLength" 27111700 0.00005103494-t 1AN88 "StandardSocket6Point1Inch1-9/16InchLength" 27111700 0.00005103494-t 1APC4 "AdjustableHookSpannerWrench3/4InchTo2InchDiameterCapacity6-3/8InchLength" 27111700 0.00005103494-t 1ARX6 "Workmaster&174;Wall ScraperHardwoodHandle3InchFlexibleBlade" 27111500 0.00005103494-t 1ATC0 "Professional&153;PuttyKnifeNylonHandle1-1/2InchStiff Blade" 27112600 0.00005103494-t 1ATC1 "Professional&153;PuttyKnifeNylonHandle1-1/2InchFlexibleBlade" 27112600 0.00005103494-t 1A033 "HidLampBallast HighPressureSodium60Hertz-40DegFOr-40DegCMinimumStartingTemperature1-3/4Inche 39111800 0.00005103494-t 1A375 "LaminatedSteel Padlock1MasterlockModel KeyedDifferent1-3/4InchX7/8InchBodySize" 46171500 0.00005103494-t 1A376 "LaminatedSteel Padlock3MasterlockModel KeyedDifferent1-1/2InchX3/4InchBodySize" 46171500 0.00005103494-t 1A693 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc10Amps" 30212000 0.00005103494-t 1A695 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc15Amps" 30212000 0.00005103494-t 1A697 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc25Amps" 30212000 0.00005103494-t 1A698 "TimeDelayFuseFrn-RSeries250VoltsAc125VoltsDc30Amps" 30212000 0.00005103494-t 1A703 "TimeDelayFuseFrs-RSeries600VoltsAc300VoltsDc15Amps" 30212000 0.00005103494-t 1A823 "Curvette&174;SwitchOn/Off RedPopUpWithOn-Off SinglePoleSingleThrow2Connections0.47InchX1.07Inch 30211900 0.00005103494-t 1A839 "HardwoodHandleWithThreadedHardwoodTipForBrushes15/16Inch" 47131600 0.00005103494-t 1A843 "Un-FlaggedBlackTampicoFloorBrushForMediumGeneralPurposeSweepingApplications 24Inches" 47131600 0.00005103494-t 1A868 "StandardCableTie7.5InchLengthBlack500PerPackage" 30212100 0.00005103494-t 1A949 "Medical PowerBarNoSwitch/PilotLightWhiteHousing4Outlets6FeetCord9-7/8InchesX2InchesX1-3/4Inches 30211700 0.00005103494-t 1CF46 "Ultra-Wipe&153;WhiteMediumDutyWiper13InchesX13Inches50PerBag16BagsPerCase" 47131500 0.00

• Visibility to purchase data across locations

• Universal pricing• Ease of migration from Internet to

procurement software

Vendor Consolidation Benefits

Supplier Selection Considerations

• Experience• Product Breadth and Availability• Resources• Technology• Measurable Results• Continuous Improvement Focus• Win-Win Relationship

Steps to Vendor Consolidation

• Review impact of consolidating critical commodities

• Suppliers become key partners• Share goals• Harness resources company-wide• Scheduled supplier reviews

Product Standardization

Benefits of Product Standardization

• Increases volume discount due to leveraged buy

• Greater control of purchasing• Reduces inventory• Reduces training• Increases compliance

Inventory Reduction / Organization

Studies Show That 70-75%Of Unplanned PurchasesAre Unique, One-TimePurchases

Lack of organization in work area creates clutter and limits work space.

Too much time is spentlooking for and replenishing supplies that are neededfrequently

Inventory Reduction / Organization

Effective workplace organizationsimplifies your environment, reduceswaste and non-value activity, whileimproving quality and safety.

This process can increase morale,create positive impressions oncustomers, and increase efficiency.

Not only will employees feel betterabout where they work, the effect oncontinuous improvement can lead toless waste, higher quality andimproved work cycle times

Inventory Reduction Benefits

• Just-in-time purchasing• Free up your space and capital• Increase internal efficiencies• Focus on your core business• Cost of money

Consolidate!

Suppliers

Products

Inventory

Get Started Saving Time And Money!

c:: Determine who is responsible for planned and unplannedORAD purchases

c:: Document the purchasing & sourcing process

c:: Identify planned vs. unplanned items and categories

c:: Quantify current spend and potential to consolidate

c:: Determine on-hand inventory values, locations, etc.

c:: Assess condition of product information data and identify potential technology solutions

Thank You!