3. 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.
4. 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.
5. 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
6. Recognizing Indirect Materials (ORAD) purchase behaviors
and the cost of the Planned and Unplanned
Strategies for Saving –
– Supplier Consolidation
– Product Standardization
– Inventory Reduction / Workplace Organization
Discussion Topics
7. Cross Referencing
You Face Many Challenges Daily…
Technical Support
Production
Line Issues
Repair PartsEmployee
Satisfaction
Cash FlowFreight Ordering
Productivity
Improvements
Budget
Cuts
Hard to Find Item
Inventory Level
Supplier out of Stock
Inventory
Delivery TimesAvailability
8. Most Unplanned Purchases Are Non-Routine
Less Than 5 Times Per Year: A search every time you purchase
10. Process Costs Can Be More Than Price of Product
The Opportunity For Savings Is In The Process
$117 $100
100%
80%
60%
40%
20%
0%
Process Cost
Process Costs
$100
Inventory
Selection and
ordering
Receipt
and payment
Price of Product
$17
14. • Visibility to purchase data across
locations
• Universal pricing
• Ease of migration from Internet to
procurement software
Vendor Consolidation Benefits
18. Benefits of Product Standardization
• Increases volume discount due to
leveraged buy
• Greater control of purchasing
• Reduces inventory
• Reduces training
• Increases compliance
19. Inventory Reduction / Organization
Studies Show That 70-75%
Of Unplanned Purchases
Are Unique, One-Time
Purchases
Lack of organization in
work area creates clutter
and limits work space.
Too much time is spent
looking for and replenishing
supplies that are needed
frequently
20. Inventory Reduction / Organization
Effective workplace organization
simplifies your environment, reduces
waste and non-value activity, while
improving quality and safety.
This process can increase morale,
create positive impressions on
customers, and increase efficiency.
Not only will employees feel better
about where they work, the effect on
continuous improvement can lead to
less waste, higher quality and
improved work cycle times
21. Inventory Reduction Benefits
• Just-in-time purchasing
• Free up your space and capital
• Increase internal efficiencies
• Focus on your core business
• Cost of money
23. Get Started Saving Time And Money!
c:: Determine who is responsible for planned and unplanned
ORAD 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
