Ideas that could save you million of pounds

1. Thinking “Outside the Box”
© Charles Eddolls 2017 1
The Buying Function Exposé
Purchasing covers the usual functions that teams of buyers end up
having to do on a daily basis, thereby leaving little time to think
laterally or to look at areas in procurement where their time could
be better spent creating “Better Best Value”.
With the above in mind, I encourage buying teams to regularly
brainstorm each supply to promote “Outside the Box” thinking as
such action creates the beneficial results that we are all striving to
achieve today.
With over 40 years purchasing at all levels, you will not be
surprised to hear of my considerable purchasing success, and
access to my thought processes could give your team ideas which
may be of use to them in the future. In my exposé I address
examples of some of the problems I have been asked to address.
Why “Outside the Box”?
I believe that a practical approach and drive to see things
through to completion are invaluable when seeking to create
benefits or when providing cost reduction solutions. Below
are some examples that show such innovation when I have
addressed purchasing and operational needs.

2. Thinking “Outside the Box”
© Charles Eddolls 2017 2
Coopers Holdings Ltd.
As operations director of the largest metal recycling
company in the UK and following our buyout from London
and Northern Securities, I needed to source fifty excavators
each year for rehandling duties. I set out to achieve the best
deal I could to rectify years of under-investment. It was
important that this deal did not affect our facility, as, in the
metal recycling industry, sufficient trading cash is vital.
I structured a five-year rolling contract for at least fifty
rehandling excavators per year. The agreement that I
negotiated gave me the ability to receive 85% first-year
buybacks and payment by non-availed promissory notes due
twelve months after each machine was delivered. The
rehanders were maintained and warranted by the
manufacturer at no extra cost. I was, therefore, able to buy
new machines every year by paying 15% of their costs at the
time of their return. I could also increase the numbers as
required. The machines were at a fraction of true costs and
as our production increased our costs reduced. I had used
my purchasing power to transfer costs back to the supplier.
No deal is sustainable unless the provider also benefits. In
this instance, the supplier made an immediate impression on
the recycling market and created a demand for one-year-old
machines. This was a win-win situation covering a five-year
commitment by each party.

3. Thinking “Outside the Box”
© Charles Eddolls 2017 3
Electrifying Savings.
I received a call one morning from an organisation building a £100
million extension to their power generating facility. It was
apparent that while undertaking this prestigious project our client
had neglected to lay on electricity in their power station for the use
of their building contractors.
They urgently required generators, transformers and switchgear to
enable this project to continue. Their procurement team, of more
than 100 personnel, had been unable to find a manufacturer to
produce the items that they required in less than nine months.
They were about to incur penalties on the project and needed
immediate assistance.
I assured the caller that there would be no problems, that I would
revert within 48 hrs and that we would be able to supply all that
was required to meet their needs within a month.
Fortunately, I had a database of potential suppliers and team of
specialists with considerable in-depth knowledge of the type of
equipment needed by this company.

4. Thinking “Outside the Box”
© Charles Eddolls 2017 4
The solution?
My team sourced previously owned equipment, and within two
weeks the first batch was installed and in use. The generators,
transformers and switchgear supplied had all been fully
refurbished and were guaranteed for the duration of the two-year
project. Deliveries were completed two weeks later, and the
equipment provided met the need of the building project.
Lessons learned?
The 100+ procurement team working for my client had not
considered all the options thereby excluding pre-used,
reconditioned and warranted, high specification machinery from
their thoughts. They had proceeded down the traditional route of
“we must only buy new from known suppliers.”
The benefits?
Our actions created savings of hundreds of thousands of pounds to
the client, even after allowing for the commission to our company
and profits for the re-conditioners who were paid a premium to
meet a very tight timescale.
What was “best value” by the end of this contract?
To have been charged high financial penalties and been left with
two-year-old generators, transformers and switchgear for sale that
cost £100,000’s more than they needed to pay or:
To have paid no penalties and had switch gear to sell that had cost
less than new prices and was worth, in the resale market, about the
same as the new ones would have been worth.
A sporting chance.
Another major organisation was extending their operating facility
such that a construction project was underway costing hundreds of
£millions. Unfortunately, they had neglected to consider a two-
storey temporary building that was in the way of the project. This
building had been used to plan the first phase of the development
but was now redundant.

5. Thinking “Outside the Box”
© Charles Eddolls 2017 5
A sporting chance (Contd.)
Because of my recycling, history, the client, contacted me for
advice on the quickest possible demolition route to rid them of this
troublesome asset. I hated waste and told them I would sell these
units for them.
The modular buildings took a couple of days to sell and afterwards
it took 19 Lorries to move the buildings to my sales point. The
buildings were sold to a heavy industrial works for part of their
sports and recreation centre. This generated considerable revenue,
and they were moved and paid for within two months of our
instructions. The industrial works were delighted as it had saved a
fortune and this purchase had enabled them to meet their promise
to their workforce to provide extensive additional facilities.
Lessons learned?
What would others have done? Probably demolished the buildings
as they would not have seen the potential to sell them. Had the
client followed this route there would have been a considerable
cost of disposal and no additional revenue.
Benefits?
What did we achieve? A considerable revenue for the client, a
modest commission for my company and another happy client
because the sports centre was acquired at a fraction of the new
cost.

6. Thinking “Outside the Box”
© Charles Eddolls 2017 6
Transport Advice.
My extensive transport knowledge enabled me to advise a
leading public-sector client to stop unknowingly breaking the
law that could have resulted in prosecution.
Their in-house transportation specialists had not correctly
evaluated the way that sub-contractors were operating their
bespoke transport contracts. Thus, their staff regularly
overload vehicles that were being dispatched from their sites
and when moving their goods.
Saving £15 million each year.
My financial knowledge enabled me to remove historical
“provision cost inclusions” in regular complex refurbishment
contracts where provision costings amounted to circa £3
Million each on up to five contracts per year.
I convinced my client to stipulate the value of each
provisional costing item in the tender document such that
bidders quoted a total figure on each contract. By issuing
tenders in this way the variable element was removed and
the client received firm costs not a combination of partially
fixed prices with a significant variable element.
The result was that my client made savings of circa £15
million each year and could reallocate substantial funds to
other important projects.

7. Thinking “Outside the Box”
© Charles Eddolls 2017 7
Reverse Auctions.
I introduced the first reverse auctions to the UK Ministry of
Defence and in their first competition saved them £750,000
on a £1.1 million spend (66%).
This was achieved when I restructured one of their existing
contracts to meet their specific needs commercially. I also
factored in an increased betterment of 14%. (80% in total)
The MoD then put in place an exclusive reverse auction
provision contract with my company.
Some years later and after many successful competitions for
MoD the commercial arm of HM Government, The Office of
Government Commerce, commissioned me to undertake a
Pan Government £232 Million tender/auction to see how
our process worked.
In this competition, a restructuring of their current needs
and the inclusion of our prequalified suppliers netted a
saving of over £100 million. (43%)
I was subsequently selected by another Government Agency
to advise on, supervise and run a successful reverse auction
for a £2 billion supply contract. (this detail is confidential)

8. Thinking “Outside the Box”
© Charles Eddolls 2017 8
Simultaneous Auctions Savings Graph.
This example shows how we ran two auctions simultaneously
with joint bidders. The bidding process was consistent for 5
hours past the closure time. Only three companies were
involved, and we created millions of pounds worth of
savings.
Savings in General.
Savings using my commercial input and our tender/reverse
auction processes have amounted to hundreds of millions of
pounds and averaged over 30%. It cannot be overstressed
that it is the innovative commercial stance taken in the
structuring of competitions that have created the platform to
make these savings not the reverse auction software in
isolation.
In each contest, my team set out to highlight savings
opportunities before they structured the tenders and this was
supported by brainstorming and discussions with suppliers
to seek their advice prior to tender.
By looking “Outside the Box,” we communicated with
suppliers and detailed our findings back to all bidders prior
to tender. By acting in this manner, we were commercially
addressing the needs and were fully compliant with EU
procurement regulations

9. Thinking “Outside the Box”
© Charles Eddolls 2017 9
How can you Benefit from this Information?
The advantages of direct access to specialist advice can be
invaluable and to facilitate this need I offer small parcels of time in
an entirely confidential environment.
As to the worth of my involvement I set out below a few examples
of savings that are in the public domain.
Organisation Supply Percentage
Arenson Steel Pressings 8.70
Alexander Dennis Parts Delivery 30.60
Compass Group Branded Pasta 36.73
DSCA Audio Visual 41.10
EMR Oil and Lubricants 25.72
Hellman Worldwide Courier cost 22.04
Nottingham University Leases for equipment 18.00
RUH Bath Contrast Media 63.00
RH for Neurodisability Incontinence Products 39.12
Schneider Electrics Tools 17.80
ThyssenKrupp Oil & Lubricants 37.22
Tube Lines Stationery & Printing 46.94
Whilst it is easier to follow a well-trodden path, I believe that it is
far more satisfying to see a creative use of resource when this
produces lower costs and provides “Better Best Value”. So, I advise
you always spare a few moments to think “Outside the Box” on any
project.
As a final thought, we all benefit from additional professional input
and the above shows what can be achieved. I offer these benefits to
interested parties at realistic costs. More detail concerning my
working history is available on the following website:
www.charleseddolls.com
I respect your decisions as to external involvement and wish you
well in your procurement endeavours during the coming years.