Facilities Management Optimization: Identifying 11% in Immediate Cost Reduction Opportunities

Challenge: Lacking Standardized Contracts & SLAs

The retailer’s refrigeration services were sourced from 40+ suppliers through informal, invoice-based transactions. The absence of structured contracts, standardized Service Level Agreements (SLAs), and preventive maintenance strategies led to inconsistent service quality, excessive costs, and billing errors.

Approach: Contract Management Designs Contracting Model

The PRGX Contract Management services performed a comprehensive spend analysis, reviewing ledger and invoice data to identify key cost drivers, service inconsistencies, and billing inaccuracies. Leveraging internal market intelligence and best-in-class commercial practices, we designed a structured contracting model. We provided an RFP framework to guide the retailer in rationalizing the supply base from 40+ suppliers down to a focused, highly capable preferred supplier network, each bound by comprehensive contracts featuring clear SLAs, competitive pricing, and robust controls to mitigate billing errors.

Additionally, we supplied industry benchmark data demonstrating the financial and operational benefits of implementing preventive maintenance programs alongside existing reactive (break-fix) service models.

Results

• Identified $3M+ (approximately 11%) in immediate cost-reduction opportunities.
• Established best-in-class commercial contract structures, ensuring consistent, competitive pricing.
• Provided industry benchmarks supporting proactive preventive maintenance programs to optimize asset longevity and reduce downtime.
• Delivered a recommended operational model framework to enhance work order management and supplier oversight.

Key Takeaways

• Formal contracting with strategic suppliers drives substantial financial and operational efficiencies.
• Robust SLA structures and proactive maintenance benchmarks significantly reduce long-term costs.
• Supplier rationalization and structured procurement enhance service consistency, reduce billing errors, and strengthen supplier relationships.

Key Spend Categories:  Logistics, Facilities, Technology, Temp Labor, Outsourced Services, Construction 

Streamline Your Most Complex Supplier Spend with PRGX Contract Management

The PRGX Contract Management team is ready to help you gain greater visibility and insight into contract details and address systemic errors, ensuring immediate cash recoveries and long-term cost savings. Just in the past year, PRGX has analyzed $2.3T client spend with $2.3B client revenue across industries and services, yielding 10x average ROI. Chat with our team of experts about your unique goals and or watch a demo to see our solutions in action.