Dabur, a more than 120-year-old company, is a household name in India.
With a range of products from mosquito repellent to honey, it straddles a wide spectrum in its consumer offerings. With 14 manufacturing plants and more than 4000 employees and a market spread across Asia, North America, Europe and Africa, Dabur was straddled with unique challenges to streamline its manufacturing supply chain and vendor management systems. The management identified the need to refine its vendor management system ensuring quality check and uniformity in vendor sourcing.
Mr. Sumit Mukherjee, Vice-President and Head – Central Procurement at Dabur India Limited says, “When you work across countries, the challenge is in terms of negotiating with them at the same time, running transparent bids in different currencies, different time periods and different languages.” As sourcing was across continents, Dabur knew the time was ripe for re-assessing the entire process.
Dabur switched to SAP’s Ariba to tackle the challenge of efficient and effective procurement processes. Through Ariba, buyers get the autonomy on managing the entire purchasing process which in turn helps build healthy, ethical supply chains. Also, it allows the suppliers to connect with the best-suited customers as well as efficiently scale existing relationships, giving them greater cash control along the way.
Tackling global manufacturing supply chain challenges with streamlined processes
Dabur benefitted in many ways after switching to SAP Ariba Sourcing Solution. Average savings increased from 6% to 8% in the first few years, owing to a positive response from existing vendors. Centralized process management for all vendor related processes helped consolidate spend management and minimize maverick spending.
Within 3 years of implementation, there was a multifold increase in the negotiation speed. The negotiation time reduced from 3 days via offline processes to within an hour using Ariba’s online solutions. The process simplicity and agility also improved the vendor-side responsiveness. From just 11 events in 2002, today Dabur does more than 350 sourcing events yearly using Ariba sourcing on the cloud
The new process provided greater transparency leading to simpler compliance and audit management. Overall, the sourcing teams were left with more time in hand to work on strategic tasks, such as price forecasting. The integrated partnership was a success that promoted an overall culture of e-sourcing, leading to better resource and cost management of Dabur’s manufacturing supply chain and vendor management system.
“The idea in any organization is to give the sourcing tool in the hands of the buyer so that he can deal with it independently without any kind of assistance. All these criteria, Ariba met most seamlessly, and it still does,” says Mr. Mukherjee.
Watch the video to learn how challenges of negotiating with vendors from several countries, running transformation bids real-time in their currencies, time periods and languages were managed and overcome through Ariba:
Learn more: Find out how digitalization with the help of SAP Ariba has helped food exporter, Allanasons cut sourcing time and money.