April 17, 2023
By:EmpoweringCPO Insights Team

Dihydroxyphenylglycine (DHPG)

Introduction

This Should Cost Analysis focuses on Dihydroxyphenylglycine (DHPG). With factors such as manufacturing location and place of usage varying, this template can be modified as needed. EmpoweringCPO, a proficient sourcing company, brings you this report by our experienced sourcing and procurement professionals to facilitate strategic sourcing solutions, offering procurement intelligence, spend analytics tools, and ongoing category management.

Objective

The key objectives of this Should Cost Analysis include:

  1. Facilitating negotiations with the incumbent supplier without initiating an RFP process, thereby maintaining the existing relationships.
  2. Convincing stakeholders from both procurement and user departments to proceed with a complete strategic sourcing process.
  3. Providing valuable insights that aid in executing subsequent steps of the strategic sourcing process.

Methodology Adopted

Our team conducted primary and secondary research to compute various cost components in the Should Cost Analysis. We reached out to vendors to gather prices for primary raw materials and equipment. The following high-level information was gathered:

  • Material Balance / Process Input and Output Flow: Our analysis is based on a research paper titled “(S)-3,5-DHPG: A Review” published in CNS Drug Reviews.
  • Capital Cost: The capital cost is calculated as the average of the capital cost from other should cost models.
  • Outbound Freight: We identified distances for each origin and destination, nearby airports, and air freight costs to present comprehensive information on outbound freight costs.
  • Manpower Cost: Manpower calculations are based on news articles and reports from the pharma company. The manpower requirement has been calculated according to the plant capacity.

Next Steps

EmpoweringCPO can support your Strategic Sourcing project with the following services:

  • Category Profile Deck: Providing an industry snapshot and Porter’s Five Forces analysis.
  • Identifying Leading Eligible Vendors / Participants: We can help identify and evaluate potential vendors.
  • Data Collection & Cleaning: We assist with data collection, validation, and cleaning.
  • Baseline Preparation: We support in establishing a solid baseline.
  • RFP Package Preparation: We can develop comprehensive RFP packages.
  • Vendor Response Evaluation: We assist in evaluating vendor responses.
  • Negotiation Strategy: We help in developing effective negotiation strategies.
  • Vendor Shortlisting / Contract Preparation: We provide guidance in shortlisting vendors and preparing contracts.

Conclusion

EmpoweringCPO is ready to assist you with projects like Dihydroxyphenylglycine (DHPG) sourcing. If you need similar reports for other categories, do not hesitate to reach out. Our suite of procurement tools including the Procurement Dashboard, Supplier Spend Analysis, Procurement Intelligence, and Procurement Consultancy can further empower your organization to achieve procurement excellence.

EmpoweringCPO is a team of experienced sourcing and procurement professionals with hands on experience of having worked with many fortune 500 companies. The company was founded in 2011 and since then has executed multiple strategic sourcing projects and have achieved average savings of 10-12% so far. In addition to Strategic Sourcing their other offerings are Spend Analysis, Procurement Intelligence, Procurement Analytics, Best Cost Country Sourcing, Procurement Outsourcing, Built Operate Transfer, Supplier Diversity, Sustainable Procurement, Tail Spend Management, Item Master Optimization, Collective Buying, Compliance Tracking and Managed Procurement Services.

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Absolutely. We believe in the unique potential of each organization. Share your aspirations, and we’ll craft a procurement narrative that’s exclusively yours, resonating with your goals and ethos.

We’re with you. Beyond strategies, we impart knowledge. Dive into our workshops and training modules designed to kindle the procurement genius within your team.

Data is a goldmine when understood. With our procurement analytics, we turn your raw data into actionable insights, highlighting opportunities for cost savings, efficiency improvements, and strategic decision-making.

In a global marketplace, knowing where to source is as crucial as what to source. Our best cost country sourcing identifies optimal sourcing locations based on quality, cost, and risk, ensuring your global operations remain competitive and resilient.

Uncertainties demand vigilance. Our supplier risk management actively monitors, evaluates, and strategizes against potential supplier risks. From geopolitical changes to supply chain disruptions, we help you stay a step ahead, ensuring continuity and stability.

An optimized item master is foundational for efficient inventory management. We refine and standardize your item data, leading to accurate tracking, reduced redundancies, and a smoother procurement lifecycle.

Procurement intelligence goes beyond traditional market research. It offers tailored insights specific to procurement activities—supplier landscapes, pricing models, and risk assessments. With EmpoweringCPO, you get actionable intelligence designed to optimize and elevate your procurement decisions.

Our custom dashboards and tools offer a holistic view of your procurement operations at a glance. By integrating real-time data, performance metrics, and analytical insights, they empower your team to make informed, agile decisions, driving efficiency and value.

Consider us an extension of your team. Our managed procurement service handles the intricacies of your procurement processes, from sourcing to payment. By leveraging our expertise, you gain the freedom to focus on core business functions while enjoying enhanced procurement efficiency.

Supplier diversity enriches your supply chain by integrating businesses from varied backgrounds, ensuring inclusivity. This not only promotes innovation and resilience but also positions your organization as a forward-thinking, socially-responsible entity.

Savings projected after strategic sourcing project should mirror savings achieved and reaslized. Our savings compliance tracking ensures this by validating and monitoring realized savings against set benchmarks and projected savings, infusing transparency and confidence into your cost-saving endeavors.

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You can reach us if you need a customized version of this report. We can also help you with category specific RFP template or with executing end to end Strategic Sourcing project.

Compliance Management Tool

Compliance management is very critical as otherwise the procurement organization may run into a scenario where there is a huge gap between realized savings and reported savings. Many procurement functions estimate large savings numbers when contracts are signed. They also invest significant time and effort in negotiating contracts for necessary goods and services, only to have a third or more of their purchasing dollars flow outside those deals. Some of the obvious fall-outs of non-compliance and maverick purchases are:

  • Very high prices
  • Risk of losing out on volume discounts and rebates

As compared to the current contract that was finalized after the sourcing process, the tool helps in tracking:

  • Vendor Compliance
  • Price Compliance

The objective of this tool is to ensure that the orders are placed only with the vendors that were shortlisted after the sourcing process and at the same price that was agreed upon and negotiated during and after the strategic sourcing process.

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