Product Development &

European Purchasing

Carl-Friedrich Wayand,

Brammer plc, European

Purchasing Director

Intellectual Property Notice

The trademarks, logos and other registered marks of BRAMMER including,

but not limited to, the “BRAMMER” “INSITE” and “GENIE” trademarks and

logos, are the exclusive property of BRAMMER, and may not be used or

reproduced without BRAMMER’S prior written consent.

Agenda

European Purchasing

Organisation

Supplier Relationship Management including

Product Development

Supplier Relationship

Management

Supplier Relationship

Management

Supplier Development Supplier Strategy Supplier Collaboration

Measurement of Suppliers‘ performnace in

order to improve on Delivery-Quality-

Cost-Service/Support-Innovation

Set up the overall Group Purchasing

Strategy (incl multiple sourcing)

Management of differentiated Supplier

Relationship based on Strategy and

Segmentation

Supplier Segmentation

Segmentation based on impact on

Brammer‘s and Supplier‘s business

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

Bottleneck Non critical

Strategic Leverage

Commercial supplier

Strategic supplier

Imp

act

on

Su

pp

lier’

s b

usin

ess

Impact on Brammer’s business

l

o

w

high

high

European Supply

Agreements

Strategic Growth

Agreements

Strategic Cost

Management

Executive

BRM

Operational review

meetings

Operational Review

meetings

Business

Review

Executive

BRM

BRM

Growth rate &

Turnover

:

High (>80%)

Low (< 20%)

Number of suppliers:

Low

High

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

Growth rate &

Turnover

:

High (>80%)

Low (< 20%)

Number of suppliers:

Low

High

Supply

Base

Supplier Strategy

Reduce the number of suppliers

Concentrate the business on key premium suppliers

Develop a special “partnership” with some of them

>80% of purchases concentrated on Strategic/Preferred

Suppliers

< 20% of purchases with Commercial Suppliers

Authorised in every country –

product availability and

support

Competitive Pricing

Common profit improvement

European Supply Agreement

Geographic development

Key account support

Supplier Relationship Strategy Strategic / Preferred Suppliers Criteria

New product development

Preferential support

Supply

chain/channel/marketing

requirement

Willing to engage in three

year planning cycle

Willing to ‘think outside the

box’ and to implement locally

Supplier Relationship Strategy Strategic / Preferred Suppliers Criteria

Strategic /

Preferred Suppliers Commercial

Suppliers

Supplier Strategy

Is there a difference in the relationship?

Long term relationship

Preferential support

Access to the Brammer’s

pan European distribution

channels

Common business

understanding

Supplier Relationship Strategy Strategic / Preferred Suppliers

Alignment of business strategy

in B.R.M.

Brammer Business growth

provides opportunities

Common growth (turnover &

market share), faster than the

market

European Supply Agreement

Supplier Relationship Strategy Strategic / Preferred Suppliers

Short term relationship

Pure commercial relationship

based on terms and conditions

No access to the Brammer’s

pan European distribution

channels for Key Account and

classical MRO Customer (local,

regional biz relationship)

Supplier Relationship Strategy Commercial Suppliers

No promotion. Suppliers in

this group are under permanent

review to be phased out.

Upgrading to preferred level

only possible by exceptional

performance (product and / or

services), combined with

increasing brand recognition.

Supplier Relationship Strategy Commercial Suppliers

15

Growth rate &

Turnover:

High (>80%)

Low (< 20%)

Number of suppliers:

Low

High

Supplier Relationship Strategy Pyramid Bottom Up and Top Down

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

Bottleneck Non critical

Strategic Leverage

Commercial supplier

Strategic supplier

Imp

act

on

Su

pp

lier’

s b

usin

ess

Impact on Brammer’s business

l

o

w

high

high

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

Bottleneck Routine

Strategic Leverage

Commercial supplier

Strategic supplier

Imp

act

on

Su

pp

lier’

s b

usin

ess

Impact on Brammer’s business low

high

high

Supplier Segmentation Portfolio

Management:

Input for

Differentiation

Supplier Relationship

Managment

Status Purchasing Strategies: Product

Group Level

Health and Safety: WIP (2011 – 2012)

Tools and maintenance: WIP (2011 – 2012)

20

*

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

S.M.S.

Supplier Management System Measurement of the main suppliers performance

Tool for continous improvement

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

Supplier Relationship Management

Supplier

Development Supplier Strategy

Supplier

Collaboration

Measurement of Suppliers‘

performance in order to

improve on Delivery-Quality-

Cost-Service/Support-

Innovation

Management of

differentiated Supplier

Relationship based on

Strategy and Segmentation

Supplier

Segmentation

Segmentation based on

impact on Brammer‘s and

Supplier‘s business

European Supply

Agreements

Strategic Growth

Agreements

Strategic Cost Mgmt

Executive

BRM

Operational review

meetings

Operational Review

meetings

Business

Review

Executive

BRM

BRM

Set up the overall Group

Purchasing Strategy (incl

multiple sourcing)

Scope Who - Brammer Who - Supplier Frequency

High-level

relationship and

strategy

alignment

CEO; CFO; EPD CEO, Key Account

Manager

1 to 2x year

European

Business review

European

Supplier Rating

Corrective action

planning

EPD, Leadbuyer Key Account Manager

3 to 4 x year

Performance

review;

Corrective action

planning

Purchasing Director;

MD (partly); Sales Mgr

(partly)

Sales mgr., key local

contact

1 to 2 x per

quarter

Executive

BRM

Operational review

meetings

Operational Review

meetings

Business Review

Executive

BRM

Business Review Meetings

for strategic and preferred suppliers

• Positive margin development therefore

• Profitable business therefore

• Win - Win - Win situation

Supplier Relationship

Management

Thank You For Your Attention

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