Manufacturing Industry: Why Profit Lies in Procurement

The old saying "Profit lies in procurement" is well-known in the business world. Today, it seems more relevant than ever, and it sets high expectations for procurement organizations. In the manufacturing industry—whether in aerospace, electronics, or chemicals—material costs often account for over 50% of total costs. In the automotive industry, this figure can rise to over 70%. This shows that optimizing material costs not only boosts efficiency but also increases profitability. Procurement, therefore, holds significant potential for cost savings.