MRO procurement consulting services can help a company figure out the most cost-effective way to purchase the supplies its needs for daily operations and ongoing repairs. MRO procurement also allows companies to find the most efficient way to obtain supplies. Some of the strategies and techniques used as part of MRO procurement consulting include:

MRO consulting can help to increase the productivity of a factory or manufacturing plant, decrease overall costs and minimize downtime when equipment breaks or needs updating.

MRO procurement might be one of the most important but most overlooked indirect spend categories within an organization. The Chartered Institute of Procurement and Supply defines MRO as any item that plays a part in restoring or maintaining a system or piece of equipment so that it can function in the required fashion. MRO is an indirect spend category because the items purchased under it are a necessary part of the production process but are not the final product.

A few examples of items that are usually part of MRO include lubricants, cleaning supplies and materials, spare parts and tools.

Since MRO includes a wide range of items and covers a wide swath of territory, managing it while keeping costs down and efficiency up can become challenging. It’s not uncommon for businesses to vastly underestimate how much they spend on MRO products annually. It’s also not unusual for companies to have redundancies in the MRO category, especially if an organization has more than one location or operates multiple plants.

Other factors, such as changes in the law or new or increased tariffs, can also affect a company’s MRO spend. The tariffs that went into effect in 2018 impose a duty of 25 percent on steel imported from certain foreign countries and a duty of 10 percent on aluminum imported from particular countries. The tariffs increase the cost of raw materials that enterprises typically need to maintain, operate or repair equipment. This forces a company to make up the difference, either by increasing the price of its own products or attempting to find a more cost-effective alternative.

How is MRO procurement consulting different from procurement consulting? MRO procurement consulting is part of the larger whole of procurement consulting. Procurement consulting may include:

Procurement consultants can assist businesses with tackling MRO, which is often one of the most overwhelming indirect spend categories for companies. MRO procurement consulting often allows companies to significantly lower their overall indirect spending.

Dryden Group includes a team of experienced MRO procurement consultants who can help you manage this overwhelming, catch-all category. We can provide your organization with the expertise to develop and implement a carefully crafted sourcing strategy that will help you gain control of costs, maintain compliance and standardize your purchasing procedures. By facilitating transparency, our MRO sourcing consultants can increase indirect spend visibility, identify areas of waste and remove weak links in your supply chain.

MRO typically covers a wide area. Everything from screws and nails to specialized equipment and services fall under MRO. Some organizations use MRO as a catch-all category. Any object or service that doesn’t fall neatly into a distinct category is classified as MRO.

MRO procurement strategies can take multiple forms, all of which should come together to help companies save money and time and to boost productivity. Consulting solutions from Dryden include:

Procurement consultants can assist businesses with tackling MRO, which is often one of the most overwhelming indirect spend categories for companies. MRO procurement consulting often allows companies to significantly lower their overall indirect spending.

Dryden Group can help you:

Through our MRO sourcing management services, you gain a more thorough understanding of your organization’s existing MRO requirements and identify and eliminate wasteful spending. The information obtained also lets you anticipate and prepare for future MRO needs.

Another factor that can make MRO procurement challenging is the nature of the category. It is not easy to predict when or if a piece of equipment will break. When something does break, there’s no way to be certain what part will fail first. That often means the buyers make spot buys, purchasing a specific part or supply when they need it, regardless of price. Additionally, there are often multiple MRO buyers within an organization and occasionally little to no communication between those buyers and their counterparts.

Occasionally, people assume procurement is the same thing as purchasing. While purchasing is part of it, procurement is much more than selecting items to buy and then buying them. Procurement should be a key part of a company’s strategy, as it involves choosing and vetting vendors, negotiating contracts, determining payment terms, selecting the appropriate products and, finally, making the purchase.

Since 2001, Dryden has worked with companies on the Fortune 500 list as well as smaller companies on the Global 2000 list, helping them to manage and contain the cost of indirect spend. We encourage companies to approach procurement and MRO purchasing issues from multiple angles. A few of the tactics we have taken include:

The two cases above are just a small sample of the ways that MRO procurement consulting helps a business save money and improve its operations.

Companies often consider MRO supply chain management a type of tactical spend. When a warehouse is out of window cleaner, it goes out to buy a new bottle. When a conveyor belt brakes, the business buys a new ball bearing. Once a piece of equipment has reached the end of its useful life, it’s time to buy a new one. Tactical spending, also called tactical sourcing, focuses on the short-term requirements of a particular part of an organization, rather than the long-term needs of the organization as a whole.

The trouble with a tactical approach is that it often leads to waste. For example, some organizations find themselves with a good portion of their inventory either obsolete or more than what they need. When MRO procurement is treated as a tactical spend, companies often find themselves stuck using the same supplier or vendor, never having the opportunity to explore other relationships or opportunities.

In fact, often when a part breaks or a piece of equipment needs replaced, buyers are tempted to go with the first supplier they find or the supplier that offers the best price. Taking that approach can mean that a company spends too much on a product or purchases a lower-quality product, which can increase the total cost of ownership. Working with a procurement consultant to develop a preferred supplier base has two major benefits in this case:

Although MRO procurement is often looked at as a type of tactical sourcing, developing a more strategic approach to it might pay off in the long run. Strategic sourcing assesses the current needs of an entire organization, focusing on the total cost of ownership and looking to make decisions that pose the least amount of risk to the supply chain.

One way to develop a strategic approach to MRO procurement and supply chain management is to work with a consulting firm. A strategic approach to managing your MRO supply chain and procurement practices saves you money in the long run.

By enlisting the services of Dryden Group, you will be able to remedy a constant challenge of your operation and implement an organized, tightly categorized system. Our expertise and recommendations also let you centralize your procurement strategies and practices and align them with broader, company-wide objectives. Top management will come to recognize MRO as a value center instead of an indirect-spend center.

At Dryden Group, your bottom line is our top priority, which is why our MRO sourcing consultants strive to improve efficiency and add value to each of our partners’ procurement processes, providing you with the tools to thrive and meet your growth and budgeting goals.

Dryden Group is committed to helping our clients by providing best-in-market procurement services. Our team of MRO sourcing consultants works tirelessly to add value to the procurement process and to improve the efficiency and effectiveness of our client’s MRO processes. We are happy to answer any questions you have about MRO procurement and how taking a strategic approach to MRO purchasing can assist your company.

We can explain more about our services, explain how MRO procurement works in your industry, and give more insight into how your company can benefit from working with us. We will optimize your spending so you can feel confident your money is going to the right places. Our hands-on approach and vast knowledge gleaned from years in this business have turned our organization into the trusted name in indirect procurement processes.

See what a difference we can make for your business. Use the form below to get in touch with us today.