Profiles in Supply Chain Enablement: Global manufacturer streamlines and standardizes sourcing processes by tapping Web-based solution
Company: Blyth Inc. (Greenwich, CT)
Company Size: Large
Company Sector: Manufacturing
Area(s) of Enablement: Sourcing
Enabler: Procuri, Inc. (Atlanta, GA)
Case Study:
With more than $1.5 billion in annual sales worldwide, Blyth Inc. is a leading designer and marketer of home decorative and fragranced products. Its business units include PartyLite, a direct seller of candles and accessories; Miles Kimball and Walter Drake, catalog sales companies; and Sterno, the number one brand in chafing fuel worldwide. To increase efficiency and reduce costs, Blyth needed to streamline and standardize its sourcing processes. The organization's various business groups had been independently purchasing certain goods and services with each unit using separate technologies and processes. In 2003, Linda Peyton, Blyth's senior manager of procurement technology, performed a comprehensive market analysis and decided to implement two pilot projects utilizing different systems. "When we performed the pilot projects, it was clear to us that Procuri's business model was a much better fit for Blyth," said Peyton. "Unlike Procuri, other offerings focused more on the services and less on teaching the user community the system functionalities resulting in the need for consultant involvement. Our goal was to educate our own user community and establish internal experts. Selecting one of Procuri's competitors' solutions would have greatly increased our overall costs because of consultant fees."
Training Globally
Blyth has grown through acquisitions but allows its business units to continue to operate entrepreneurially while adopting standardized business procedures where it makes sense. It is important that newly acquired companies can quickly implement and utilize a common sourcing solution to maximize efficiency and reduce unnecessary costs. The procurement technology department realized that Procuri's Web-based system enabled them to quickly train procurement resources globally. Initially, Blyth began using Procuri's solutions in its main Global Sourcing department in Chicago to globally source goods and services. Within the first month of implementing the sourcing application, Blyth procurement team members in North America and Europe were trained; three months later, the Asia Global Sourcing group was also trained on the system. Today the company is in the process of rolling out Procuri's solutions beyond its procurement personnel to anyone having procurement related responsibilities. The ultimate goal is to have 300 to 500 employees companywide using the sourcing solution. Blyth realized a quick return on its investment with cost savings from its initial auctions for corrugate, chipboard packaging, and ocean freight containers. Blyth currently sources a variety of direct materials such as fragrance, ceramics, porcelain, glass, metal, plastic, chemicals, alcohol, and methanol, as well as finished goods.
First-year Savings
Due to the great success achieved from these events, the company is now considering sourcing indirect materials such as office supplies, services, etc. Not only using Procuri's application for reverse auctions, but it is also taking full advantage of Procuri's functionalities also for sealed bids and requests for quotes. Blyth can now get purchasing information from suppliers in minutes instead of days and the resulting efficiency has increased adoption throughout the company. In the first six months using Procuri's solutions, Blyth filtered $68 million worth of goods through the Procuri tool and realized approximately $2 million in savings in its first year (2003). In December 2004, Blyth was the charter customer to begin using the Procuri TotalAnalytics solution, provided by SAS Institute, to rationalize and normalize data and prioritize spend categories for enhanced supplier relationships. The Global Sourcing group is continuing to gain insight into Blyth's supply chain and procurement spending through these solutions and is focusing on completing its global rollout of Procuri's solutions in Europe.
For more stories of successful supply chain implementations, read the "2005 Supply & Demand Chain Executive 100" article in the June/July 2005 issue of the magazine. Also watch the Today's Headlines section of SDCExec.com every Tuesday and Thursday for more in depth best practices drawn from this year's Supply & Demand Chain Executive 100.
