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Success Stories

Three successful case studies of RA for transportation


Case 1- Success story of cost reduction through RA for transportation of a leading Steel Tubes manufacturing Company in India:

The leading steel pipes manufacturing company located in NCR has four production units in different locations in the country. They have been finalizing their transportation contracts through manual Auction and subsequent manual negotiations. As the company has a large number of destinations, it was taking a lot of time to finalize the transportation contracts. The company requested for RA of transportation for one production unit as a sample to see the results of transportation E-Auction.

SP ensured record participation of 25 bidders in addition to existing bidders in RA of the company. As a result of fierce competition, RA achieved saving of 5% to 11% in transportation rates in comparison to existing rates. Satisfied with the result of first RA, the company has introduced RA for transportation of other production units, thereby also achieving substantial savings.

Conclusion:

Typical results of a RA are presented for reference and information with the message that RA is very strong and proven tool to optimize transportation costs.

Sl. No. Destinations
From---to---		 Type of Truck (FLT)
(Ton capacity) 		Existing rates
(Rs. per Ton) 		Rates achieved in the RA
(Rs. per Ton) 		% of Saving
1 Sikandrabad to Hisar (Haryana) 22 Ton 810 715 11.72%
2 Sikandrabad to Bangalore(Ktk) 20 Ton 4880 4350 10.86%
3 Sikandrabad to Pune (Maharastra) 20 Ton 2750 2610 5.09%
4 Sikandrabad to Surat (Gujrat) 22 Ton 1762 1632 7.37%
5 Sikandrabad to Baddi (H.P) 20 Ton 890 835 6.17%
Case 2- Success story of cost reduction through RA for transportation of a leading paint manufacturing company in India:

The company has a large network of FLT (Full Load Truck) movements throughout India. The company had been finalizing logistic contracts manually which was a very time-consuming process because of high volume. After knowing the advantages of RA for transport, the company requested for RA to service provider for finalizing transportation. In the first RA itself, the company has been able to achieve 5 % to 21 % savings in the RA. The company was so satisfied with the result of first E-Auction that it has already conducted many more RAs for its other manufacturing plants across India.

Conclusion:

Typical results of a RA for transportation are presented for reference and information with the message that RA is very strong and proven tool to optimize the transportation costs.

Sl. No. Destinations
From---to---		 Type of Truck (FLT) (Ton capacity) Existing rates
(Rs. per Ton) 		Rates achieved in the RA
(Rs. per Ton) 		% of Saving
1 Kolkata to Patna (Bihar) 16 Ton 35000 33000 5.71%
2 Kolkata to Guwahati (Assam) 16 Ton 64000 59200 7.5%
3 Kolkata to Mumbai (Maharashtra) 16 Ton 64000 50800 20.62%
4 Kolkata to Varanasi (UP) 16 Ton 41600 34240 17.69%
5 Kolkata to Lucknow (UP) 21 Ton 54600 44520 18.46%
Case 3- Success story of cost reduction through RA for transportation of a leading engine manufacturing company in India:

The company was finalizing its logistics contract for full load truck (FLT) transport from its Hosur and Indore plants through auction. Contract finalization was taking a long time and negotiations were also not resulting in realistic rates. For finalizing logistics contracts, RA was conducted. In the first E-Auction itself a saving of 8 to 10 % was achieved by the company. Thereafter, the company decided to finalize transport contracts-only through RA.

Conclusion:

Typical results of a RA are presented for reference and information with the message that RA is very strong and proven tool to optimize the transportation costs.

Sl. No. Destinations
From---to---		 Type of Truck (FLT) (Ton capacity) Existing rates
(Rs. per Ton) 		Rates achieved in the RA
(Rs. per Ton) 		% of Saving
1 Hosur to Pithampur LCV , 7 Ton 28500 24500 14.03 %
2 Bangalore to Chennai LCV , 5 Ton 9600 8760 8.75%
3 Pithampur to Hosur LCV , 7 Ton 33600 30600 8.92 %
4 Chennai to Hosur HCV, 9 Ton 13300 12200 8.27%


Success story of RA for Door to Door International shipping


Case 4- Success story of cost reduction through RA for international shipping including custom clearance of a leading Auto parts manufacturing Company in NCR region in India:

Normally, RA is not conducted for international shipping for goods to be delivered from one country to another (door to door delivery basis inclusive of ancillary activities and custom clearance). However, it was experimented to conduct RA for international shipping from door to door delivery basis including custom clearance for export movements to six countries from India. Incredible results were achieved in the first E-Auction and savings to the tune of 13 % to 25 % were achieved. The company has repeated the RA with satisfied results.

This area of E-Auctions is still unexplored and can be focused for shipping rate reduction and finalizing the contacts in an expeditious manner.

More and more clients are coming forward for RA for international shipping with door to door goods delivery services covering export and import of commodities.

Conclusion:

Typical results of a RA are presented here below for reference and information with the message that RA is very strong and proven tool to optimize even international shipping on a door to door delivery of goods basis including custom clearance costs.

Sl. No. Destinations
From---to---		 FLC – Type of Container (Ton capacity) Existing rates
(Rs. per Ton) 		Rates achieved in the RA
(Rs. per Ton) 		% of Saving
1 Bawal to VMI facility (GKN) BZ, Italy 21 Ton 242055 187455 22.55 %
2 Bawal to Dana Hungry KFT, Gyor 21 Ton 253725 189225 25.42%
3 Bawal to Dana Italia SRL, Arco, Italy 21 Ton 205972 161872 21.41 %
4 Bawal to CarraroDrivetech Padova, Italy 21 Ton 187014 160914 13.95 %

Three case studies of RA for procurement


Case 5- Success story of cost reduction of procurement through RA for a leading motor manufacturing Company in India:

The company was procuring Aluminium Alloy ingots every month through manual auction and negotiations. The service provider conducted E-Auctions for procuring monthly quantity of aluminium. In the first E-Auction itself, the company achieved savings of 4 to 9% in comparison to existing procurement rates in addition to other advantages like reduction in purchase cycle through E-Auction. The company is continuing procurement through E-Auction for the last 6 years and has successfully introduced new suppliers by giving trial orders.

Conclusion:

Following is the record of a typical E-Auction confirming savings with the conclusion that RA can be used for optimization of purchase prices for many RA amenable commodities like Aluminium.

Sl. No. Items Quantity (In Ton) Prevailing auction Price (Rs. per Kg) Rates achieved in the RA (Rs. per Kg) % of Saving
1 Aluminium Alloy ADC 12, XXXX Ton 118 /Kg 110.75 /Kg 6.14 %
2 Aluminium Alloy ADC 12, XXXX Ton 119 /Kg 115 /Kg 3.36 %
Case 6- Success story of cost reduction through RA for procuring consumables for a leading FMCG company in Delhi NCR:

The following success story presents that even the consumables procurement costs can be optimized when the quantities are high and the number of bidders is more, to create competition. This is the real achievement of E-Auctions that up to 23% of cost saving has been achieved. The purchase cost can be optimized as per the market prices and that is the advantage of E-Auction.

Conclusion:

The result of RA is presented for reference and information with the message that RA is very strong and proven tool to optimize the purchase cost even for consumables.

Sl. No. Items Quantity (In KG) Start Price (Rs. per Kg) Rates achieved in the RA (Rs. per Kg) % of Saving
1 Chana Dal 100000 Kg 56 46 17 %
2 Besan Fine 100000 Kg 56 48 21 %
3 Besan Coarse 100000 Kg 56 49 23%
Case 7- Success story of cost reduction through RA for purchase of cans for a leading paint producing company in Kolkata:

RA was conducted for a large paint manufacturing MNC of Kolkata where results have been indicated as following. The competition could not be created as the number of bidders was not high.

Conclusion:

The RA results as presented in the table indicate the percentage saving. This saving could have been more, had the RA been organized more efficiently.

Sl. No. Items Quantity (In Nos.) Start Price (Rs. per piece) Rates in Rs. achieved in the E-Auction % of Saving
1 500 ML Enamel Can (Luxol HG/Satin/LuxolXtra) 294000 10.75 10.7 0.5 %
2 1 Litre Enamel Can (Luxol HG/Satin/LuxolXtra) 650000 16.25 16.1 1 %
3 1 Litre Primer Can ( Bpwp/rop/bpcp) 320000 16.1 16.05 0.31 %
4 4 litre Enamel Can (Luxol HG/Satin/LuxolXtra) 131000 45.45 45.1 0.76 %
5 4 Litre Primer Can ( Bpwp/rop/bpcp) 65000 45.21 44.96 0.55 %

Two case studies of FA for sale


Case 8- Success story of increasing sales realization, selling through FA, for a leading motor manufacturing company in India:

An NCR based MNC dealing in manufacture of motors was having monthly generation of melting scrap and miscellaneous items amounting to approx. 800 -900 MT per month. The company was selling these items through monthly auction mode and disposal cycle was quite high to finalize the sale contracts. The E-Auction company was approached and a presentation was made to the senior management of the company highlighting the ease of process and advantages of E-Auction for disposal of items through E-Auction. The E-Auction company conducted a trial E-Auction to prove all the advantages as shared in the presentation. In the first E-Auction itself, E-Auctioneer introduced new bidders, some of whom were actual users of the scrap. “This is a fantastic achievement in prices” was the reaction of the head of the company. The items were sold at 12-15% higher price in comparison to what the company used to get through tender mode.

Conclusion:

This company has been successfully selling all of its scrap items through E-Auction mode for the last six years and is getting optimum market prices which are sometimes even higher than the prevailing prices in the market. Here below, a typical E-Auction result of an actual E-Auction is presented with a message that FA is a suitable mode to dispose scrap and other similar items.

Sl. No. Items Quantity (In Ton) Start Price Rates achieved in the FA Approx.% increase from Start bid to Final price
1 Lam cutting scrap 800-900 Ton 24000 29000 20 %
2 MS Turing scrap 30 Ton 19000 23500 23 %
3 Tin Tapper scrap 20 Ton 20500 24500 19 %
4 MS Component Scrap 15 Ton 20000 24600 23 %
5 Rotor scrap 15 Ton 30000 34000 13 %
Case 9- Success story of sales realization through FA for a leading automobile company in Maharashtra, India:

The following results of an FA conducted for a leading automobile company for selling various kind of scraps being generated from the production of automobiles. The percentage of savings achieved ranged from 11%to17% over the prevailing prices which is really fantastic and very good for the client. If manual physical negotiations are done, this kind of revenue realization is really not possible. This also proves that FA is the right tool for disposing the scrap including old, used & unserviceable items, idle assets, non-moving materials. It is strongly recommended that all manufacturing companies should adopt FA as mode of disposal for scrap and old equipment.

Conclusion:

The company is selling successfully all its scrap items through only E-Auction mode for last few years and is getting optimum market prices which are sometimes higher than the prevailing prices in the market. Here below, E-Auction results of an E-Auction, are presented with a message that FA is a suitable mode to dispose scrap and other similar items.

Sl. No. Items Quantity (In Ton) Start Price(Rs. per Ton) Rates achieved in the FA (Rs. per Ton) % of Saving
1 OFFCUT SCRAP (Commercial) 500 Ton 29500 33000 15 %
2 M S Scrap 600 Ton 25500 28900 17 %
3 M S Mixed Scrap 200 Ton 25900 29100 11 %
4 Cut Blank and Rolled Sheet 250 Ton 33000 38100 15 %
5 M S Punching cutting / Blanking Scrap 250 Ton 27500 32200 17 %