Scope
Advisory - Cost Out Diagnostics
Industry
Food and Beverage
introduction
Over a 12-week period, 7SS undertook an opportunity assessment across $440m global addressable spend to identify opportunities for value creation across all procurement.
Business Challenge
Operating 427 restaurants across four Nordic countries under separate agreements led to inefficiencies and limited scalability. 7SS was engaged to unify operations through a supply chain optimisation workstream within a wider business transformation.
Our client operated restaurants under a master franchise agreement made with Corporation. The business was a combination of Nordic restaurants.
Our client had the Swedish, Norwegian, Danish and Finish master franchise agreements for each country with each operating independently of one another. 427 franchised restaurants.
7SS was engaged to lead a supply chain optimisation workstream as part of a wider business transformation focussing on a new franchise strategy, organisational design, marketing and IT.
Our solution
7SS took a structured, data-led approach to define the as-is state and identify improvement opportunities. Spend, contracts, and policies were analysed to establish a clear baseline, then validated through interviews with key buyers to understand real-world processes and capability. The findings were benchmarked against best practice to develop sourcing strategies by category, and a delivery roadmap was created to prioritise actions by ease and benefit — forming the foundation for implementation.
Data Collection / Analysis
Key information to determine the as-is baseline was sought. This included spend data (for example, what was being spent, when, by whom and with which suppliers), contract data (pricing / terms), policies (to determine any demand management) and stakeholder maps in the business.
The output was a clear baseline of the as-is and with spend segmented by category.
Interview
From the segmented spend the key business buyers were identified. Sessions were set up with these individuals to develop the baseline further. This also gauged the as-is buying processes plus explored the competence and capability of the current buying practices.
Baseline
To determine the opportunities, the as-is was reviewed against good practice in other organisations. The output was a sourcing strategy developed for each procurement category.
Validation & Proposal
The final phase of the assessment was to validate the opportunities with the business and develop an appropriate delivery roadmap based on ease of implementation versus size of benefit. 7SS was then engaged to deliver the opportunities.
Outcomes
The project delivered results in two phases. A 12-week diagnostic identified cost-saving and cash-flow opportunities, producing 25 prioritised initiatives. Over the next 18 months, 7SS implemented a new procurement and supply chain model, realising €33m in benefits across key categories and embedding sustainable practices for long-term impact.
Diagnostic
(12 weeks)
Complete a supply chain diagnostic to identify opportunities for cost saving across the operation and to improve cash flow for the franchisees.
Develop a delivery roadmap based upon addressability of spend and feasibility of implementation.
25 priority initiatives proposed to be implemented across 3 waves.
Delivery
(18 months)
TOM design for future organisation model for procurement and supply chain.
Primary focus on a core set of categories including proteins, condiments, logistics, packaging and utilities – €195m spend. Benefits of €10m.
Secondary focus on indirects, beverage, potato, dairy and bakery – €183m spend. Benefits of €23m.
Tertiary focus establishing sustainable procurement via a new target operating model.