CPG Firm Uncovers ₤8M in Overcharges and Billing Errors

Challenge: Optimizing Spend and Efficiency in Large-Scale CPG Production 

A leading CPG firm with co-packer production faced challenges managing an extensive supplier base and a £1.6B auditable spend. Having grown from six to 22 suppliers across North America, they encountered Bill of Material (BOM) errors and cost discrepancies, requiring a solution to streamline operations and capture cost savings. 

Solution: Contract Management Services Delivers Significant ROI on CPG Spend 

High-volume CPG co-packing comes with frequent price changes and potential quantity errors alongside multiple currencies that can lead to an inaccurate spend. A professional review of contract details can safeguard your bottom line by identifying potential risks and hidden errors. 

The PRGX Contract Management services team applied an industry-leading methodology and technology to deliver more than ₤8M in future savings and ₤2.7M in cash recovery. 

Breakdowns Identified: 

• BOM quantity errors 

• Purchase Price Variance (PPV) cost true ups  

• Scrap/shrink standard versus actual warehousing charge errors 

• Packaging cost overcharges  

• Core charge credits 

• Foreign currency translation errors 

Key Learnings: 

• Audit led to contract template re-write 

• Validating components of BOM – mostly raw materials 

Streamline Your Spend Across Multiple Suppliers with PRGX Contract Management

The PRGX Contract Management team is ready to help you simplify even the most challenging CPG projects with supplier management and detailed spend visibility. PRGX combines big data technology with advanced audit expertise to give you a 360-degree view of your CPG business. 

PRGX has analyzed $2.3T client spend with $2.3B client revenue across industries and services, yielding 10x average ROI. Chat with our team of experts about your unique goals and or watch a demo to see our solutions in action.