My job in Cargill

1. Cost reduction policy results

FY08/09
Nov-May
(cost reduction
target - 30%)
4%
spend
CS/NS
27%
NA
69%
spend
$515 724
CS/NS
$202 100
NA
cost reduction
$27 139
31%

2. Overall savings results in Cargill

FY08/09,09/10
spend
13%
4%
CS/NS
NA
83%
spend
$3 280 817
CS/NS
$523 272
NA
$174 652
cost reduction
18%

3. How I did savings

Method
Resource
Moving from re-sellers to
producers
Specification clarification
Moving from high cost producer
to low cost producer
Market analysis/Developing
specification (mainly
localization)
Negotiation with incumbent
supplier
Analysis prices in the
market/Purchasing tactics
Supply chain optimization
(volume discounts,
transportation savings)
Assessing business
needs/collaboration with
supplier

4. Auto PRs generation system

Before
After
PRs were generated manually
against actual stock amount. Human
element
PRs are generated by trigger in esystem against actual stock amount.
Human resources economy
Minimum stock amount were defined
without taking into account factors
(lead time and actual consumption)
Minimum stock amount are defined
basing on developed formula (lead
time and actual consumption)
A lot of requesters from different
departments (production,
warehouse, purchasing). No SOP.
Chaos
Approved by stakeholders SOP (RACI
model) establishing agreement
Actual consumption and specification Long-term agreements against data
were not defined. No long-term
from Requesters=>volume
agreements
discounts/better prices and higher
supplier service level