Crown Cork & Seal Extends Procurement Services Relationship

Packaging company signs up for four more years with ICG Commerce, expands deal to cover new spend categories

Packaging company signs up for four more years with ICG Commerce, expands deal to cover new spend categories

Philadelphia — April 13, 2004 — Packaging company Crown Cork & Seal USA has signed a multi-year extension and expansion of its procurement services contract with ICG Commerce, building on a relationship begun in 2000.

Headquartered in Philadelphia, Crown designs and manufactures packaging products for consumer goods. The company's primary products include steel and aluminum cans for food, beverage and consumer products, as well as a variety of metal and plastic caps, closures and dispensing systems. With 28,000 employees at operations in 44 countries, the company had 2003 sales of $6.6 billion.

Procurement excellence has long been a top priority for Crown, and the company has worked diligently to leverage its internal expenditures in order to significantly reduce purchasing costs. In 2000 Crown became one of the earliest adopters of the procurement services provider (PSP) model, selecting ICG Commerce to provide sourcing, purchase-to-pay automation and ongoing category management services for select indirect product categories.

Since that time, according to ICG, Crown has reduced its costs by over 10 percent and has generated year-over-year cost improvements resulting in an additional 3-7 percent savings. Furthermore, the company has enhanced visibility and control of expenditures by instituting greater discipline over internal requisition and approval processes and by utilizing ICG Commerce's purchase-to-pay platform, RealExchange, the solution provider said.

Given the increasingly challenging economic environment that many manufacturers are facing, Crown is expanding the scope of its procurement cost savings initiative to include additional commodities such as plant maintenance, repair and operations (MRO), packaging and services like temporary labor. Crown has again engaged ICG Commerce to support this initiative, doubling the number of categories and related spend addressed by the partnership.

"In evaluating options to address this new phase of our sourcing program, it became evident that ICG Commerce is still the only partner that provides not only sourcing expertise and technology but also critical savings implementation and ongoing category management services," said Edward Vesey, senior vice president for procurement for Crown. "While consultancies may provide sourcing services, what Crown needed, and has successfully experienced with ICG Commerce, is a focus that goes beyond identifying savings to ensure realization and ongoing improvement."