Pret a Manger
Delivering value through FM
Pret A Manger is a successful, profitable business with over 240 shops in the UK and strong growth with 20-30 new shop openings in 2012. If Pret are to maintain and build upon this position and develop tight control over costs is critical. With this in mind, Pret launched a procurement project to identify and realise cost savings in non-trading goods and services in order to mitigate unavoidable cost increases in areas such as rent and energy. Pret didn’t have sufficient resources to focus on all non-trading goods so they engaged Procure4 on a trial basis to look at a small number of low spend categories in order to test the relationship, performance and results!
The total spend in scope was just c£600k and included only three categories – CCTV, General Building Fabric and Painting and Decorating. One of the biggest challenges was; could we really deliver savings on this level of spend? Buying power and leveraging economies of scale did not feature highly on our approach strategy. Nor did e-Auctions, lengthy tender processes or supply market reviews. Instead, we focused on leveraging our market intelligence, supplier relationships and the strong Pret brand in order to deliver results.
Utilising market intelligence, relationship based negotiation and understanding the importance of the Client brand enabled Procure4 to deliver 30% savings even in the face of relatively low spend.
One element of success was the technology costs relating to CCTV equipment. Even if clients have negotiated a competitive price with suppliers at the outset, this is quickly eroded due to falling technology prices. Using our market intelligence, supplier relationships and negotiation skills, Procure4 was able to quickly identify and negotiate significant savings for Pret.
Another area was Painting and Decorating where we focused on the individual cost elements and quickly identified that although the client was getting a very competitive labour rate, nearly 50% of the costs related to overnight accommodation and travel. This led us to propose an alternative National supply strategy to eliminate the unnecessary costs. We then sourced and implemented a national supplier using our market intelligence and relationships.
By taking this approach, we were able to demonstrate to Pret that we could add genuine value by bringing extra capacity, market insight and procurement expertise.