Cost Reduction Projects

CUSTOM MARKET ANALYTICS

Supply managers make assumptions about the future of supply markets every time they contract with suppliers, or choose not to. Understanding the outlook for key variables of a capital equipment supply market, such as lead time, capacity, price, and market competitiveness, is critical to deciding the right price and contract term. 

COST BENCHMARKING AND ESTIMATING

BSI offers Major Capital Project (MCP) cost estimates based on Activity-Based Costing (ABC) and benchmarks. We verify and validate by benchmarking the projects against similar projects, and by “fitting” the cost of major components (such as hydrocracking reactors) to the specific engineering requirements of each project based on our proprietary “price cubes.”

VALUE CHAIN ENGINEERING

For buyers, effective supply chain management should make operations more agile and less costly. BSI has literally “written the book” on methods and techniques to reduce cost and improve quality simultaneously by acting on the end-to-end supply chain. For suppliers, value chain design should result in delighted customers, marketing flexibility, and enhanced innovation and speed to market.

TENDER DESIGN AND MANAGEMENT 

Major capital projects, especially those on a larger scale than have been realized in the past, necessarily involve close coordination with likely suppliers, which complicates bidding and rules out the conventional approach of sending a full package of specifications to numerous bidders and choosing the lowest bid. The process involves dialogue and pre-qualification.

CONTRACT NEGOTIATION

A thorough negotiating strategy can make the difference between an agreement that falls apart and a long-lasting and profitable relationship. BSI assists buyers and suppliers in negotiating thorough and comprehensive win-win agreements that survive the duration of the contract term and into multiple renewals.

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