Princes Foods: Procurement Key to Financial Resilience
Princes Foods, a food and beverage industry leader, has prioritised the optimisation of its procurement strategy to enhance the company’s financial resilience in hiring a senior Procurement Consultant.
The company, which specialises in the production and distribution of canned goods, made the move to optimise cost structures by hiring Paul McGrath, an accomplished procurement professional with experience in the FMCG and pharma sectors.
The appointment yielded successes across the extension of payment terms, the development of a vendor rating system and overall improvement to the company’s cash flow.
Paul’s appointment focused on improving the following areas of Princes’ procurement:
- Extension of payment terms: By extending payment terms across all procurement categories, Princes saw a cash flow improvement of over £30m.
- Vendor rating system: Paul developed a vendor rating system to promote effective relationships, recognising the importance of Supplier Relationship Management (SRM).
- Cost reduction strategies: He also worked with external consultants to deliver £10m in retained savings for Princes.
- Structures for tracking procurement costs: By developing structures to track and review procurement cost reduction efforts, Paul ensured transparency across all procurement activities.
- Consultative oversight: He was also able to leverage his experience to guide and mentor procurement team members, developing their knowledge and skills to ensure the longevity of these improvements.
By fostering effective SRM and improving Princes Foods’ cash flow, Paul’s procurement action resulted in tangible financial benefits for the company.
The company has boasted an increased financial resilience as a result of the above developments, achieved during a transitional period for Princes Foods.
The successful outcome of financial optimisation and efficiency was achieved through just an outside IR35 day contract.
Princes Foods achieved an increased year-on-year revenue from 2022’s UK£1.44bn to 2023’s UK£1.74bn and hopes this re-evaluated procurement plan will continue this upward trend.
These financial improvements are not the only positive to come out of this redirection.
In appointing Paul, Princes Foods have also secured a robust foundation for the company’s future procurement strategies as the procurement team is now better equipped to work towards the company’s objectives and adapt towards the dynamic industry environment.
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