Case Study #3: Decentralized Purchasing & Accounting Resulting in Higher Costs

With 14 years of experience refining best practices, BirchStreet has compiled a variety of problems that our customers have faced. These issues were all solved by BirchStreet’s procure-to-pay functionality. This is the third case study in an ongoing series of solutions to the challenges in hopes that we may be able to help improve your business and operational processes.

Problem: Decentralized purchasing and accounting resulted in higher product costs

Scenario: The customer had a large portfolio of properties and different regions that often used different suppliers and distributors. This resulted in off-contract spend and higher prices because they were not buying in bulk.

Solution: The customer implemented BirchStreet’s cloud-based eProcurement solution, which integrated into BirchStreet’s strategic partner Avendra, a GPO (group purchasing organization that negotiates better pricing with suppliers). Using Avendra for most of their purchasing and tracking it through BirchStreet, all the properties spend was centralized in their BirchStreet marketplace. Their costs were reduce by 15% off the street pricing they were used to, and their overall costs due to process improvement and efficiency dropped by 8%. Management was able to view on-contract spend by property through reporting and BI (business intelligence) tools within BirchStreet.

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