Metaldyne Outsources Procurement

Auto supplier hands MRO purchasing over to DSSI

Detroit  November 13, 2001  Automotive supplier Metaldyne Corp. is handing over the purchasing of its maintenance, repair and operating commodities to Motor City outsourced purchasing services provider Direct Sourcing Solutions Inc. (DSSI).

The agreement calls for Detroit-based DSSI to conduct all purchasing activities related to Metaldyne's MRO and replacement parts commodities, a move that Metaldyne says will allow it to focus on core business objectives.

"DSSI's business model and experience made this an easy decision," said, Doug Grimm, vice president of supply chain management for Metaldyne. "They have proven e-capabilities, and because the relationship is based on the savings DSSI generates, there are no investment costs for Metaldyne."

Grimm also noted DSSI's experience buying the commodities Metaldyne uses and its experience working with suppliers of those commodities.

Under the agreement, Metaldyne requisitioners will use DSSI's e-procurement application, Epic, to manage the transactional portion of the process. Epic will provide requisitioning, request for quotation, claims and financial settlement tools via the Web. Additionally, DSSI's commodity managers, commodity specialists and buyers will manage the supplier relationships by negotiating pricing, managing online catalogs and facilitating purchasing roundtables to identify and implement additional savings opportunities.

"We are pleased to be working with Metaldyne, an innovative company that clearly recognizes the value of an outsourced purchasing model," said B.P. Thacker, president and CEO of DSSI.

Thacker said that Metaldyne should realize cost savings through reduced fixed operating costs and lower piece prices for goods and services, as well as reduced delivery timing.

The Metaldyne program will be fully implemented in the first quarter 2002, with other commodities scheduled to be added throughout the life of the agreement.