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Purchasing to take advantage of Volume Discounts

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  • Purchasing to take advantage of Volume Discounts

    My company currently uses a 3PL to purchase components and manufacture our finished goods. Our sales have increased YOY and it is time that I feel the need to request price reductions from our 3PL which is part of our annual contract.

    We have begun to perform SKU consolidation so that our 3PL can increase its order volume on a SKU level to thier suppliers and possibly recieve discounts that could be passed to us. What other options do I have from a purchasing/procurement level to reduce cost?

    Does anyone have any models or suggestions? If more information is needed let me know and thank you in advance for any assitance you can give.

  • #2
    Re: Purchasing to take advantage of Volume Discounts

    scmcafee,

    Hi and welcome to SCF.

    Just a few questions:
    1. Where is your company based?
    2. How may SKUs in the range?
    3. How long has the 3PL contract been running?
    4. Has the 3PL been performing well, and in accordance with the contract?
    5. Does the contract allow for price reductions?
    6. Is the 3PL based in trhe same country?
    Regards

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    • #3
      Re: Purchasing to take advantage of Volume Discounts

      Where is your company based? The 3PL is based in Tennesse, while we are based in Texas
      How may SKUs in the range? There are 9 SKU's however those skus are broken down into 12 components(ie. box, cd, sticker, rebate form....). There are some components that are used for each sku...however the cd and certain stickers are not
      How long has the 3PL contract been running? 3 years
      Has the 3PL been performing well, and in accordance with the contract? Yes.
      Does the contract allow for price reductions? The contract stipulates there will be a annual price reduction based on savings derived from purchasing/procurment practices and any other form of lean management...
      Is the 3PL based in trhe same country? Yes

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