Synergy West Printed Pitch

1

West Australian based West Australian based boutique boutique cost cost

management consultancy management consultancy that identifies and that identifies and

implements effective cost implements effective cost reduction strategiesreduction strategies

We assist our clients in We assist our clients in increasing their increasing their

profitability profitability through cost through cost reduction while meeting reduction while meeting

their quality and their quality and operational requirementsoperational requirements

1

Our focus is on YOUR Our focus is on YOUR non-core operating non-core operating

expenses where expenses where savings goes directly savings goes directly

to the to the bottom-linebottom-line

CouriersCouriersFactory ConsumablesFactory ConsumablesFleet ManagementFleet ManagementFood ServicesFood ServicesFork Lift ServicesFork Lift ServicesFreightFreightInformation TechnologyInformation TechnologyInsuranceInsuranceJanitorial ServicesJanitorial ServicesLaboratory SuppliesLaboratory SuppliesMerchant Card FeesMerchant Card Fees

Office ProductsOffice ProductsPackagingPackagingPayroll ProcessingPayroll ProcessingPrintPrintRecords ManagementRecords ManagementTelecommunicationsTelecommunicationsTemporary LaborTemporary LaborUniformsUniformsUtilitiesUtilitiesWaste ManagementWaste ManagementCustomer SpecificCustomer Specific

10% COST REDUCTION = 10% COST REDUCTION = 18% INCREASE IN NET PROFIT18% INCREASE IN NET PROFIT

Profit *& LossProfit *& Loss Pre-Synergy Pre-Synergy West West

Post-Synergy Post-Synergy West West

RevenueRevenue $10M$10M $10M$10M

Costs:Costs:

PurchasesPurchases $6M$6M $6M$6M

LabourLabour $1.2M$1.2M $1.2M$1.2M

General Exp.General Exp. $1.8M$1.8M $1.62M (-10%)$1.62M (-10%)

Net ProfitNet Profit $1M$1M $1.18M (+18%)$1.18M (+18%)

Seller Has An Unfair Advantage

DIY ?DIY ?

We have We have benchmarking data benchmarking data from the various from the various projects and industries we have served over the projects and industries we have served over the years; years;

Our Our width width andand depth of professional expertise depth of professional expertise covers in dozens of overhead cost categories that covers in dozens of overhead cost categories that most companies cannot possibly afford to employ most companies cannot possibly afford to employ internally;internally;

Reducing the cost of non-core overhead expenses, Reducing the cost of non-core overhead expenses, audited line for line is audited line for line is ALL WE DO ALL WE DO &&

Bad-cop -Bad-cop -suppliers know that “we know what suppliers know that “we know what they know “ – this means competitive tension!they know “ – this means competitive tension!

1

Your Your Time Time

Value of Value of Money :Money :

Broad Industry Experience

Industry *Company Annual Revenue

Category SpendClient Hours Invested

Client Savings

Returnper HourInvested

Savings per project

Engineering $200,000,000.00 $150,000.00 3 $16,170.50 $5,390.17 22%Labour Hire $20,000,000.00 $770,000.00 8 $135,549.00 $16,943.63 35%Labour Hire $27,000,000.00 $877,027.00 10 $38,792.50 $3,879.25 9%Leisure $12,000,000.00 $120,000.00 9 $8,500.00 $923.91 14%Logistics $100,000,000.00 $403,775.00 2 $25,438.00 $12,719.00 13%Logistics $120,000,000.00 $3,200,000.00 11 $215,000.00 $19,545.45 13%Logistics $8,000,000,000.00 $180,000.00 3 $19,551.00 $6,517.00 22%Manufacturing $25,000,000.00 $417,501.00 6 $21,989.93 $3,664.99 11%Manufacturing $200,000,000.00 $460,000.00 13 $74,396.00 $5,722.77 32%Manufacturing $180,000,000.00 $3,484,159.00 9 $120,571.00 $13,396.78 8%Mining $1,200,000,000.00 $206,664.00 4 $17,000.00 $4,250.00 12%Mining $100,000,000.00 $5,200,000.00 38 $258,454.00 $6,801.42 13%Telecommunications $941,000,000.00 $103,000.00 4 $12,000.00 $3,000.00 23%Total (Ave) $1,197,855.85 9 $7,904.18 17%

* West Australian Companies engaged with Synergy West

$7904.18 $7904.18 PH:PH:

Seller Has An Unfair Advantage

Why we find Why we find savings :savings :

Your Unfair Your Unfair AdvantageAdvantage

Seller Has An Unfair Advantage

The The largest largest spending spending clients clients don’t always get don’t always get

the best pricethe best price

Seller Has An Unfair Advantage

Three companies Three companies with the same with the same suppliers suppliers don’t don’t

always get the same always get the same discountdiscount

Seller Has An Unfair Advantage

Supplier loyalty does Supplier loyalty does not always equate to not always equate to

best pricebest price

Seller Has An Unfair Advantage

The seller sells few The seller sells few products to many products to many clients, while clients, while the the buyer purchases buyer purchases

many products from many products from many different many different

supplierssuppliers

2013/14 2013/14 OutcomesOutcomes

Offi

ce S

upplie

s O

ffice

Supplie

s 3

3%

33

%

Offi

ce S

upplie

s O

ffice

Supplie

s 3

3%

33

%

Energ

y 9

-35

%Energ

y 9

-35

%Energ

y 9

-35

%Energ

y 9

-35

%

Cate

ring 1

7%

Cate

ring 1

7%

Cate

ring 1

7%

Cate

ring 1

7%

Tele

com

s 21

%Tele

com

s 21

%Tele

com

s 21

%Tele

com

s 21

%

Insu

rance

25

%In

sura

nce

25

%In

sura

nce

25

%In

sura

nce

25

%

Freig

ht 2

4%

Freig

ht 2

4%

Freig

ht 2

4%

Freig

ht 2

4%

Tra

vel 1

7%

Tra

vel 1

7%

Tra

vel 1

7%

Tra

vel 1

7%

Risk?Risk?

50% of actual measured 50% of actual measured savings for 24 months after savings for 24 months after

implementation:implementation:

• 10% deposit of estimated savings paid upon acceptance of 10% deposit of estimated savings paid upon acceptance of recommendation and implementationrecommendation and implementation

• Actual fee is billed monthly for the 24 months based on actual Actual fee is billed monthly for the 24 months based on actual realized savings less a credit for amortizing the depositsrealized savings less a credit for amortizing the deposits

No Savings = No FeeNo Savings = No Fee

ProcessProcess

Deliv

era

ble

Act

ivit

ies

Tim

e

Analyse Recommend Implement

6 – 8 weeks/categories

Define project scope and sign agreement

Obtain financial data

Obtain incumbent supplier contracts

Understand volumes and activity

Understand business requirements with stakeholders

Confirm business requirements

Prepare RFP

Identify and meet relevant suppliers

Manage bidding process

Benchmark costs and assist in supplier selection

24 months

Appoint supplier

Facilitate/assist implementation

Measure actual savings

Ongoing monitoring of supplier relationship and contract terms

Opportunity Report Implementation 24 Month Savings Reviews

Fees None

10% of Total Savings/ Balance Over 24 Months

If you were paying 20% If you were paying 20% more on general more on general expenses , expenses , how would how would you know it?you know it?

How do you know if you How do you know if you compared well to compared well to industry standards industry standards and and benchmarks?benchmarks?

How do you know if you How do you know if you have the best program have the best program structure to structure to ensure price ensure price tension?tension?

AccreditatAccreditationion

Certified Management Consultant (CMC) is an internationally recognized award conferred by Management Consulting Institutes that are members of the International Council of Management Consulting Institutes (ICMCI).  IMC Australia is a member of ICMCI and has sole responsibility of awarding CMC status in Australia.   The assessment and certification process must meet strict guidelines stipulated by the ICMCI.A Certified Management Consultant (CMC) provides formal and independent recognition and endorsement of the consultant's competency, skills and experience as a Management Consultant. Independently awarded by the Institute of Management Consultants, CMC is a guarantee to clients that consultants have experience and knowledge to deliver impartial, professional and cost-effective interventions with the interests of the client central to the work.   CMC is internationally recognised in over 45 countries as well as well as being the pinnacle of recognition as a management consultant.

TestimonTestimonials ials

"....were delighted to realise over $40,000 in actual gross savings at the completion of the project. By changing from five suppliers to one enabled further efficiencies in our Company’s operations." Chris Wessels-Company Secretary -Wood and Grieves Engineers

".... $35,000 in actual gross savings at the completion of the project. By changing from two suppliers to one enabled furtherefficiencies in our Company’s operations." Jason Paolone-Finance Manager -Toll Holdings

"Alba Edible Oils decided to run a trial across a few service options for a period of 4 months. At the end of the trial, we decided to change the primary incumbent freight supplier to a secondary freight supplier and appoint a new carrier for our ISO business. The project is presently yielding savings of 10%...". Nigel Parker -Commercial Manager -Kimberley Industries

“.... savings of $1.17M over two years -21 %." Ian Goldberg -Chief Financial Officer -Territory Resources

"$143,000 in gross savings at the completion of the project." George Wilson -Chief Financial Officer -Coogee Chemicals

"Savings of $97,000 was realised and in this instance KI Group changed incumbent broker" Peter Roebuck -Chief Financial Officer -KI Group

"Although iiNetdecided to stay with the incumbent supplier we are delighted with the outcome, and six months in, we continue to save upwards of 20% compared to last year's spend" Chris Brown -Company Secretary –iiNet

"Will got us a 27% savings in couriers which really opened our eyes to who else has been ripping us off. I recently negotiated savings with the Australian Government of $100k, I never thought that was possible, but then I thought if Will can do this, I’ll give it a go." Steve Silberer-Chief Financial Officer -Harvey Beef

1

Synergy West Pty Ltd Synergy West Pty Ltd ABN: 92106731800 ABN: 92106731800 PO Box 1864PO Box 1864Albany WA 6330Albany WA 6330    Contact: Will SingerContact: Will SingerTel:    Tel:     0404 887 193 0404 887 193 Email: Email: [email protected]@synergywest.com.auWeb: Web: www.synergywest.com.auwww.synergywest.com.au