In 2023, Enabling Procurement were engaged by one of their historical clients to support the rapid introduction to the market of Palmaráe Gin, a new, super premium gin brand. Enabling Procurement’s role encompassed sourcing vendors across the entire supply chain, ensuring competitive pricing to achieve COGS targets and providing support for business governance and regulatory compliance. With a small in-house team, they required external expertise to expedite their product launch and establish robust procurement and governance practices.
Objectives
- Rapid Market Entry: Source all necessary vendors across the supply chain to bring Palmaráe Gin to market quickly.
- Cost Efficiency: Ensure that all procurement activities were conducted with a focus on competitive pricing.
- Governance Support: Develop and implement policies and procedures to support business governance.
- Regulatory Compliance: Assist with obtaining the necessary licenses from local authorities for the production and sale of alcohol.
Approach
- Supply Chain Sourcing
- Market Research: Conducted extensive market research to identify potential suppliers for distilling, packaging, bottling services, logistics and warehousing
- Vendor Evaluation: Assessed vendors based on quality, reliability, and cost-effectiveness.
- Negotiations: Negotiated contracts with selected vendors to ensure favourable terms and competitive pricing.
- Competitive Pricing
- Benchmarking: Compared prices and terms with industry standards to ensure competitiveness.
- Cost Analysis: Performed detailed cost analysis to identify potential savings and optimize spending.
- Governance and Policy Implementation
- Policy Development: Created procurement policies and procedures tailored to the client’s operational needs and industry best practices.
- Training and Support: Provided training sessions for the client’s staff to ensure smooth implementation and adherence to new policies.
- Transition Planning: Developed a transition plan for when the client’s in-house procurement function would take over.
- Regulatory Compliance
- Licensing Assistance: Guided the client through the process of obtaining necessary licenses from local authorities, including documentation and application submission.
- Compliance Monitoring: Established compliance monitoring procedures to ensure ongoing adherence to regulatory requirements.
Results
- Timely Market Entry: Palmaráe Gin was successfully launched within the targeted timeframe of under a year, thanks to the streamlined procurement process.
- Cost Transparency: Implemented cost transparency across key categories and identified cost saving opportunities through strategic vendor negotiations and bulk purchasing agreements to support business scale up
- Robust Governance Framework: Implemented comprehensive procurement policies and procedures that facilitated a smooth transition to the client’s in-house procurement team.
- Regulatory Approval: Successfully obtained all necessary licenses, enabling the client to legally sell Palmaráe Gin in the market.
Conclusion
Spirit of the Oasis’s engagement with Enabling Procurement proved to be a pivotal move for the client, allowing them to bring Palmaráe Gin to market efficiently and cost-effectively. EP’s expertise in supply chain management, competitive pricing, governance, and regulatory compliance provided a strong foundation for the client’s future operations. This case study highlights the value of Enabling Procurement in accelerating product launches and establishing sustainable business practices.
Key Takeaways
- Expertise and Experience: Leveraging external procurement expertise can significantly reduce time-to-market and ensure cost-effectiveness.
- Comprehensive Support: A holistic approach to procurement, encompassing supply chain sourcing, pricing strategies, governance, and compliance, is crucial for successful product launches.
- Sustainable Practices: Establishing robust policies and procedures ensures long-term operational efficiency and compliance, supporting future growth and scalability.
