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Ferro Corp. recently announced that it has entered into a five-year agreement with Procurian Inc., a leading specialist in procurement solutions, and has expanded its relationship with Capgemini, a leading provider of technology and outsourcing services, to maximize the value derived from the company’s indirect spend procurement process. As part of Ferro’s value creation strategy, the company is initiating a comprehensive program to transform the way indirect spend is managed, improving procurement effectiveness and reducing costs.
The program will focus on expenditure categories such as professional and contract services, facilities, information technology and telecommunications, packaging, capital equipment, utilities, logistics, and travel. Ferro’s annual expenditures for such goods and services are approximately $325 million.
The program is expected to further standardize procurement processes and bring deep market intelligence and category expertise to drive cost savings and optimize spend for indirect goods and services. Procurian will provide source-to-contract and category management services that include category planning, sourcing, demand management, contracting and compliance tools. Ferro also has expanded its current agreement with Capgemini to include the outsourcing of certain procurement processes. Capgemini will assist in standardizing the back-office procurement procedures for indirect spend and will provide data management services, including purchase order creation and management.
With implementation of the indirect spend optimization initiative, Ferro is reportedly now targeting adjusted earnings for 2015 in excess of $1 per share.
“We are pleased to be expanding our relationship with Capgemini, and we look forward to working with Procurian on this important program,” said Peter Thomas, president and CEO. “We continue to vigorously execute on our strategy and are firmly focused on reducing operating costs and improving returns. The benefits we expect to achieve in our indirect spend procurement function give us further confidence that our cost-saving initiatives will generate savings greater than $100 million and drive 2015 adjusted earnings in excess of $1 per share.”
For more information visit www.ferro.com.