Retailers face unique facilities management challenges across their locations – from maintaining store presentation that impacts customer experience to managing aging infrastructure and energy consumption while ensuring regulatory compliance. Without contract oversight and regular vendor reviews, facilities management costs can silently escalate through obscured charges.
This major global retailer took a proactive approach to Contract Management across their facilities operations with PRGX that resulted in substantial future savings and immediate recoveries.
$6M+
Corrective Actions Identified
$1.4M
Cash Recoveries Realized
$160M+
Auditable Spend Total
Challenge: Improving Contract Management for Single Supplier Across Global Facilities Operations
The organization faced many challenges in maintaining visibility across their facilities management contracts spanning multiple countries. With approximately $160M in annual facilities management spend under audit, PRGX conducted thorough contract review activities across four regional Facilities Management operating hubs. The complexity of managing labor rates, markup calculations, and operational charges across global locations created significant risk for billing inaccuracies and missed savings opportunities.
Single supplier relationships sometimes create hesitancy in requesting detailed documentation or questioning billing practices, yet these conversations are essential for mutual success.
Solution: Implementing Strategic Contract Compliance and Optimization
PRGX began with thorough Contract Compliance reviews and expanded into Contract Optimization to maximize value recovery. Through this targeted approach, PRGX identified $6M+ in future cost savings opportunities and recovered $1.4M in immediate cash benefits.
The approach included:
Contract Compliance: Detailed audits identified discrepancies between contracted terms and actual billing, focusing on labor rates, markup calculations, unauthorized charges, and erroneous billing practices.
Contract Optimization: Analysis of the compliance findings revealed opportunities to adjust contract terms and strengthen future agreements by addressing systematic billing errors and clarifying ambiguous language around markup calculations.
The PRGX Contract Management Services team provided a holistic view of facilities management costs that helped reduce future risks and discrepancies while maintaining strong supplier relationships.
Breakdowns Identified:
- Miscalculated Cost Based Labor Rates
- Billed Labor Exceeds actual Payroll Cost
- Excessive Markup ATC Workers Overtime
- Excessive Markup on Travel Expense
- PTO Charges Billed in Error
- General Liability Insurance Charged in Error
- Unauthorized Charges
Key Learnings:
- Cost Tracking System Compliance Limitations
- Rate Card Escalations Computation Errors
Delivering ROI Results with PRGX Contract Management Services
The PRGX Contract Management team applies over five decades of experience across industries to help avoid cost leakage and expand profitability with smarter contracts. Our unique blend of personalized expertise and secure AI technology transforms your supplier contracts from potential risks into strategic assets.
With approximately 75% of top global retailers and a third of Fortune 500 companies relying on our services, we deliver proven expertise paired with AI-powered solutions that maximize your ROI. Ready to transform your facilities management contracts and achieve up to 6x ROI? Connect with an expert to discuss your specific needs, or watch a demo to see our solutions in action.
How Much Can You Recover?
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