Squeezing suppliers
21 January 2009 | Jake Kanter
Squeezing suppliers has become synonymous with industries such as retail and construction, so my news story today will come as little surprise.
Barratt Homes, the housebuilder which cut 3 per cent off its suppliers contracts last year, is running out of opportunities to find savings through its supply chain. Chief executive Mark Clare said the firm had squeezed suppliers so substantially that savings on build costs and raw materials were drying up.
“The procurement team are continuing to take prices down but there is a limit there because I think our supply chain is being squeezed quite substantially,” he said.
How can a company judge when to stop driving cost reduction among its suppliers?
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