Raw Material Tailwinds
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The recent environment of declining oil and gas as well as a stronger US Dollar has led to dramatic reductions in pricing for many commonly purchased goods and services.
Cost & Capital reviewed the most recent quarterly reports of major providers of raw materials and freight to analyze the year over year declines in pricing announced to Wall Street. These developments should be the starting point when setting and evaluating savings targets.
The current deflationary environment is rare and should be leveraged as an opportunity for procurement teams to achieve stretch savings targets. This report reviews the tools and methods needed to secure savings from the supply base. Savings targets set in early 2015, or at the end of 2014, should have been exceeded since such widespread deflationary pressures were likely not anticipated.