Tendering provides a clear insight into potential suppliers
Tendering is the term used to describe the procedure of comparing various suppliers before making a decision to source a product or service on the open market. The tender process makes it relatively easy to gain an insight into potential suppliers and their price/quality ratios. Tendering helps you to make well-considered choices for partners who will strengthen your supply chain.
Consulting firm Groenewout has extensive experience of supervising and supporting tender processes for companies who intend to outsource some or all of their logistics and/or transport activities. In most cases, a tender process results in considerable cost savings. Our consultants are happy to take the lead in tendering projects. They draw up a project plan, conduct analysis and prepare the necessary documentation. Often, they also act as the primary contact person in the process and evaluate the results before providing their recommendations to the decision-makers. The tender process concludes with both parties (client and logistics service provider) signing the pricing agreement and the service level agreement (SLA). Tendering activities can include:
- Complex transport tender which might involve international transportation of temperature-controlled and/or hazardous goods, for instance
- Parts of a tender project, such as preparing necessary documentation (RFI, RFQ/RFP, SLA) or an evaluation model
- Tendering on behalf of a shipper who wants to (initially) remain anonymous or have no contact with the potential service providers
- A decision on whether or not to outsource, subsequently followed by a tender
- Preparation of a longlist and/or shortlist of potential suppliers
Tendering for Nestlé
In order to give you a sense of our approach in a tendering process, we are pleased to outline the project we completed for Nestlé. Our client Nestlé Food Nederland, in combination with Nestlé Purina Nederland, asked us to lead/supervise a tender process for the outsourcing of their internal warehousing operation and their external transport. Nestlé wanted to optimize costs and flexibility while simultaneously creating extra capacity. The tender was set up in such a way that suppliers could submit proposals for several different scenarios. Our consultancy supervised the process and coordinated the tender for outsourcing all the logistics activities, including transfer of the warehouse and relevant personnel. The tender process revealed that Nestlé could expect to benefit from the following gains:
- Annual cost savings of 10% based on the current level of logistics costs (warehouse efficiency and increased synergy in distribution).
- Potential long-term cost savings resulting from the consolidation of Nestlé Food and Nestlé Purina in a multi-client warehousing environment.
- Acquisition of Nestlé’s resources including personnel, thus fulfilling its social responsibility to its employees.
More tendering references
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