After the client was recently carved-out from a parent retail organization, A&M CRG was brought in to help manage the separation planning and unlock savings opportunities within direct costs.
A&M identified and supported a full re-design of sourcing process within the company. In partnership with the Chief Merchandising Officer, A&M helped the company stand up their own internal sourcing organization, onboard new strategic vendor partners to support growth categories and minimize their current assortment of ~ 70+ vendors. Through the design and implementation of a cost-focused product planning tool and process, CRG helped the company identify $15M in COGS savings in their first year post-acquisition, representing a 5% reduction in total COGS. In addition to this significant savings unlock, process re-design and strategy work led by the A&M team within the company set them up for longer term EBITDA improvement through a new sourcing partnership strategy and reduced tariff risks in China from $26M to $6.3M.
$15M in COGS savings (5% reduction), $20M reduction in tariffs, 57% consolidation of vendors to drive long-term margin improvement