Adopting the Wax Digital web3 e-sourcing system will create cost savings of about 3-5%, the cereal manufacturer’s head of procurement, Anthony Bowdidge, told FoodManufacture.co.uk.
“The highly intuitive nature of the web3 tool makes it simple to roll out to people in the business who are not professional purchasers,” said Bowdidge. “As a result they can exploit the efficiency gains and cost savings that a sourcing and negotiation tool drives, taking some of the pressure off the procurement team.”
Instead of relying on Weetabix’s 14-strong procurement team, the firm will now be able to train up 250 staff members from a variety of roles within the business to use the system. The company will retain its specialist procurement team.
Weetabix made the decision to switch from its previous system, Ariba, after an “extensive review” of the two separate systems revealed web3 was easier to use and was more cost effective, claimed Bowdidge. Training staff to use the system also took “about 10 minutes” compared with half-a-day for the previous system, he added.
‘Paid for itself’
Although Bowdidge declined to reveal how much the new system had cost the business, he did confirm it had “paid for itself in a matter of weeks” and would continue to drive cost savings across the business.
“The first e-Auction event saved £150,000, more than justifying the investment,” he said.
While average costs savings totalled 3-5%, since each supplier was different, there were opportunities to reduce cost even more, added Bowdidge.
The new system would speed up the way Weetabix identified, qualified and negotiated with its network of about 150 suppliers, he added. The firm will use the procurement system for everything from almonds to wheat.
The system was said to help ensure the company used only the most innovative suppliers. That would improve efficiencies, reduce costs and help to expand the business worldwide, said the company.
“This system is an example of our aim of continuous improvement in every part of the organisation,” said Bowdidge. “We want suppliers who can offer innovation. There is lots going on in the business and we need suppliers that can support our innovation agenda.”
Weetabix said its focus was on developing its leading position in the UK and exploring substantial opportunities to further grow the business internationally, in North America, Asia and beyond.
The system will be rolled out across its African and North American businesses in early 2014.
The decision to adopt the web3 system also meant that Weetabix, which is already a Wax Digital customer for web3 purchase-to-pay, can benefit from a single source-to-pay process from supplier selection through to matched invoice.
Paul Ellis, md of Wax Digital, said: “Organisations are really beginning to understand and embrace the significant benefits that a completely joined up approach to procurement technology can deliver. Weetabix is leading where we expect many other businesses will soon follow.”
Weetabix Food Company is the UK's second largest branded manufacturer by value of ready-to-eat cereals and cereal bars.