Success Story - "Security Services"
Publicly Traded Global provider of ingredients and solutions to the food, beverage and other industries
Company Situation and Problem
The Client had moved to a large Global Security Services supplier and negotiated rates during the depths of the recent recession. The majority of the Security Guards had been retained by the new Security firm.
- Based upon discussions with the supplier, the Client anticipated rate increases for the future renewal period.
- The Client felt the Supplier’s pricing was reasonably competitive and did not identify any services issues.
- The client preferred the retention of the majority of the personnel and had concerns regarding transition cost and risks if a new supplier were to be recommended.
Paladin Actions & Recommendations
Paladin worked closely with the Client, compiled historical costs and analyzed the current services.
- Paladin identified some service levels which needed improvement and overtime practices that needed strengthening.
- Paladin then prepared a complete Security Services Request for Proposal and engaged the top service suppliers in the potential bid process.
With strong Paladin competitive negotiations, the incumbent was awarded a 3 year extension.
- Not only did the Client not incur an increase in the new period, the supplier reduced their markup 3 percentage points.
- In addition, since the incumbent won the extension, potential switching cost/risks were eliminated and the Client was able to work with the existing supplier on services improvement and strengthening overtime practices.