How could an outside consultant know enough about our business to come in and tell us how to run it?

“

“Working TogetherThe Importance of Client Relations

The Consultants from Expense Reduction Analysts know that you

might have concerns about an outsider coming in to work at your

company. We ask you to read this brochure, which addresses many

of the concerns employees have about our business. Give us a

chance to put your mind at ease and show you the ways we can

help you while helping your company improve its bottom line.

Expense Reduction Analysts (ERA) is an international network of

more than 700 expert expense reduction Consultants. We find

savings in overhead expenses that contribute to increased profits,

with no sacrifice in budgets, staffing, operational efficiencies or

quality of service.

ERA Consultants have offices in 30 countries and have performed

more than 14,000 successful expense-reduction projects.

Why would we need a Consultant to cut costs when we have people in our organization who are responsible for this and who already do an excellent job?

A remarkable job, actually, especially when you consider their many other responsibilities.

With hundreds of Consultants in our network, benchmarking data from over 14,000 cost-reduction projects under our belts, and a proven proprietary process, ERA offers a deep level of professional expertise in dozens of overhead cost categories that most companies cannot possibly afford to employ internally. And, in many companies, purchasing is just one of an employee’s many responsibilities, and commonly his/her focus is only on core costs. At ERA, reducing the cost of non-core overhead expenses is ALL WE DO.

How could an outside Consultant know enough about our business to come in and tell us how to run it?

Our recommendations are always based on thorough, unbiased investigations. Our Consultants are industry experts who know exactly what to look for in contracts, invoices and statements for dozens of overhead expense categories. We would never claim to be experts in your business – but we ARE experts in ours.

What can an ERA Consultant do that we can’t?

We leverage the data we’ve amassed from our 14,000 successful cost-reduction projects to negotiate the best value for your company. We find that companies who do perform their own benchmarking exercises internally tend to benchmark against themselves or against a limited-size universe. And while they may succeed in reducing a supplier’s cost, they may already be overpaying. The sheer volume of ERA’s market

data enables persuasive benchmarking capabilities. Suppliers cannot argue with data of this quality and scope.

When you invite us to work with you, you no longer need to worry about the possibility of jeopardizing your relationship with incumbent suppliers, and you no longer have to suffer through those awkward moments that can occur during price negotiations. ERA’s broad category expertise and knowledge about the marketplace put us in the driver’s seat during negotiations. You can feel confident that you are getting the very best value, and comfortable that a professional and unbiased third party is executing fair and equitable negotiations on your behalf.

ERA uses a systematic proven process that combines cutting-edge analysis tools with deep expertise and category know-how. Our proprietary process results in best-in-class cost scenarios that clearly illustrate suppliers’ capabilities and allow us to optimize value for you.

“NutriSystem believes in its clients and is there to help them every step of the way. I was struck by similarities in ERA’s business model to ours. Consultants helped NutriSystem every step of the way. They helped us implement the new processing system and for the next 18 months monitored our progress to make sure we remained on track.”

~ Kathleen Simone, Controller, NutriSystem, Pennsylvania

Q. Q.

Q.

“Without sacrificing quality of service, ERA has been able to optimize our resources. I would recommend ERA as an excellent choice for support in the management of expenses.”

~ Juan Felipe Gómez, Regional Manager - Treasury and Financial Analysis, SAP Andean and Caribbean

We monitor supplier compliance for 18 to 24 months to be sure you get what was agreed to (we are very good at catching mispriced items!). We know the supplier’s business, so we know what to ask for (e.g., we can freeze your costs when there are manufacturer price increases, get you average discounts for non-contract items, leverage substitutions – the list goes on.)

We take the pain out of the process. We implement and monitor supply agreements (a suitable role for a Consultant), and then give you the tools you need to manage the ongoing supplier relationship after we’re done. We do the work – YOU make the decisions.

What exactly do ERA Consultants do?

ERA Consultants improve their client’s profitability by reducing common overhead costs - like insurance and office supplies - and by increasing value for the client. There is no reduction in the quality of your goods and services, and frequently there is even an improvement. Average savings across categories is nearly 20%.

How do they do that?

Our analysts are experts from various industries. We bring relevant experience to clients. For example, the ERA network has Consultants with dozens of years of high-level experience in telecommunications. These people have a deep knowledge of how that industry works, and an insider’s understanding of its services and pricing structure. To top it off, we have gathered invaluable benchmark data that shows how much money businesses like yours are paying

for these services. This gives us a huge advantage when negotiating with suppliers, because we often know the supplier’s business as well as – if not even better than – the supplier does.

What kinds of business expenses do ERA Analysts look at?

Overhead expenses such as freight, packaging, insurance, printing, merchant card processing fees, telecommunications, janitorial services, laundry, temporary labor, uniforms, waste management, small package freight, etc. We’ve done everything from a merchant card processing fee project for a multi-billion dollar company to a courier project for a small sausage manufacturer, and everything in between. There has yet to be an expense category that our expansive professional network hasn’t been able to tackle!

“ERA is about implementation of proposals. And they continue to analyze and report after the implementation.”

~ Ralph Decker, CFO, E&R Cleaners, New Hampshire

Q.

Q.

Q.

“Our own people in charge of freight have been most happy to have ERA assist them. They, too, were impressed by ERA’s approach and welcomed cost improvements without negative consequences on client service.”

~ Niek Dudink, Operations Director, Stryker

“We will now save both time and money while continuing to provide the highest quality service because of the work done by ERA.”

~ Mary Kay Sweeney, Executive Director, Homeward Bound of Marin, California

• Not only is Expense Reduction Analysts the largest cost-reduction consultancy in the world, the depth and breadth of experience throughout ERA’s international network of 700+ Consultants is hard to match.

• Consultants come from high-level positions in varied industries and bring their insider’s knowledge of that industry to negotiate masterfully with your suppliers.

Expense Reduction Analysts offers many advantages

• ERA has amassed benchmarking data from more than 14,000 successful cost-reduction projects worldwide, and uses it to compare what you’re paying to what like companies are paying for the same goods and services.

• ERA Consultants regularly approach projects as joint ventures, to assure clients get the most qualified expense category experts on their projects and, consequently, the largest savings possible.

• ERA Consultants work on contingency. We’re so confident that we will find savings for your company that we won’t earn a fee unless we succeed; the client has absolutely nothing to lose and everything to gain.

• Consultants in the ERA network don’t just deliver a recommendation then hit the road – they actually implement the recommendation and audit and monitor the results for up to two full years to be sure the client is getting the pricing the supplier contractually agreed to.

• ERA uses cutting-edge proprietary procurement tools that facilitate optimal decision making.

ERA’s cost savings projects often have positive, vs. negative, ramifications on staff.

For example, ERA was once able to save a company a significant percentage on

its health insurance premiums. The company decided to share the savings with

its employees by reducing monthly employee contributions. And, to top it off, the

employees ended up with even better health plan coverage!

If ERA finds a huge cost savings, face it, it could make the person responsible for purchasing look bad. Have any internal purchasing employees ever lost their jobs?

Not in our experience. ERA Consultants can only get a project done by partnering with the client’s internal purchasing or administrative team. We come in as a resource and assistant to the purchasing specialists. Conversely, we use purchasing specialists as a sounding board and advisor when we need information and guidance.

To have a successful project, Consultants from ERA rely on your help. So much do we value our clients’ internal staff that ERA abstains from any cost-cutting projects that involve staff reduction. In an article called “Creative Cost-Cutting Tactics for Small Biz” in November 2008’s edition of Forbes, ERA’s Chief Executive Officer Ken Hagerstrom points out how eliminating staff during a bad economy puts a company at a great disadvantage when the economy improves.

In short, we are NOT a replacement for internal personnel. In fact, the employees with whom we work and successfully partner usually share the credit for enabling the cost savings.

When a client gets outstanding results from an ERA analysis it is because of the powerful combination of its employees’ aptitude and understanding of the internal workings with the ERA Consultant’s analytical abilities and category expertise, benchmarking data and sophisticated analysis tools.

What kind of tools do you use?

ERA uses a proprietary suite of tools called Procurion. It does everything from analyzing consumables to soliciting, tracking and managing the bid process. After Procurion creates a detailed spreadsheet of the quantitative results of the bidding exercise, Consultants perform a qualitative analysis that integrates supplier competencies and your company’s concerns about that particular expense category into the decision process.

Our Consultants combine tools, expertise, analytical savvy and negotiating skill to synthesize the rich information they have generated, and use it to improve your company’s bottom line.

We already do everything possible to keep costs controlled.

Smart business people do their best to control costs. But it’s a lot of work and it’s a full-time job, so they tend to focus on core expenditures; rarely do they have the time or manpower to analyze the non-core expenses associated with the day-to-day operation of their business (utilities, telecom, janitorial, etc.).

We are better equipped than most companies to negotiate with suppliers about overhead expenses. While companies generally go out to bid maybe once a year, we perform hundreds of bids in all expense categories every week, and we speak with suppliers all the time. We come from these suppliers’ industries; we know the insider jargon clients couldn’t

possibly know. And we have reams of benchmarks to give us the negotiating edge.

Doesn’t cutting costs lead to a cut in quality?

Our goal is to provide cost-reducing solutions to our clients that deliver the best value. It’s not a matter of finding the lowest bid – in fact, 90% of the time the lowest bid does NOT win the contract.

Our goal always is to maintain quality and reduce cost. Often we are able to improve quality without increasing cost. Then there are the times we both improve quality AND reduce costs!

What is ERA’s process and how would the employees participate?

First we gather data from your general ledger, thoroughly analyze what your company is spending and present your company with a report that identifies expense categories with savings potential. If your company decides to proceed based on our findings, we initiate, track and manage the bid process and present you with a report recommending a course of action.

We continue to work closely with your company for the next 18-24 months to ensure that your company realizes the negotiated cost savings. Our commitment to “sticking around” and helping out for the ensuing year-and-a-half+ distinguishes ERA from virtually all other cost reduction consultants.

Q. Q.

Q.

Q.

“The most organized, most professional and most guaranteed results-oriented of the number of expense reduction companies we looked at. We have not been disappointed.”

– Jeff Benes, President, Catalyst Manufacturing Services, North Carolina

“ERA delivered a great result and put new supply and service-level agreements into place where none had previously existed.”

~ Graeme Brown, CFO, EziBuy, Australia

Management consultant and author Peter Drucker once said: “My greatest strength as a consultant is to be ignorant and ask a few questions.” We will ask questions about your company’s priorities; we will ask the accounts payable and purchasing departments to help us understand your company’s purchasing processes and to gather and understand your company’s data. And, of course, we want to get to meet everyone who would be involved in a cost-reduction project.

What is your fee?

There is no out-of-pocket charge for our analysis. We are so confident in our ability to find savings that we work on a contingency basis. The only way we get paid is if we find savings, and then we keep a percentage of the savings that are realized during the course of the project. After that, the client keeps all of the savings. Talk about a win-win situation!

Do you have relationships with certain vendors that help you get cost savings for your clients?

No. We are an unbiased third party with no preferred vendors. We derive 100% of our revenues from our proportion of the savings we implement for our clients. We are very much aware of the importance of supplier relations and work hard to build trust and collaboration with yours.

We have a good relationship with our suppliers. I trust them to do right by us.

Yes, but they know more than you know about their product or service, and this gives them the advantage in the buyer-seller relationship. ERA Consultants know as much as – often more than – suppliers in non-core cost categories. We use our benchmark information to deliver the kind of competitive pressure that keeps supplier bids on track. This way, the trust you have in them is earned and validated over time. We have found that in 60% of our projects the incumbent keeps the business, only at a lower cost to the client.

Does it ever get contentious with the suppliers?

Even as we apply powerful competitive pressure needed to optimize savings for you, ERA Consultants work very hard to build strong relationships with your suppliers. We go as far as to debrief suppliers who do not win the contract, to help them understand what they need to do to be competitive in the marketplace

so they might win the bid in the future. Suppliers see the ERA Consultant as an unbiased partner who keeps the playing field level - which is exactly what we do.

We’ve been with some of our suppliers for years. I wouldn’t want to change.

We respect clients’ loyalties to their suppliers, and we are happy to simply re-negotiate current agreements with them if changing is not an option or a desire. Again, 60% of the time the client ends up with the incumbent supplier anyway! Throughout our project we give each supplier’s product or service the attention it deserves, so you don’t have to. If there are savings to be had, you don’t have to feel awkward about asking for them, because we do that for you.

I’m beginning to see the value – what if I have more questions?

We look to you as the organization’s expert, and hope you see us as a valuable resource you can use to help manage overhead costs.

We know that the appearance of a Consultant often causes concern. Talk to us. Ask us hard questions. If we are going to work together, we need you to feel comfortable and to trust us so that your company ends up with the best possible results.

“Diamond Staffing, Inc. has had an exceptional relationship with ERA over the past two years. We have participated in many staffing RFP’s from local level to a national level. From the initial start of the RFP process through the implementation stages ERA is always available, ready to assist, and 100% involved in the day to day success of both Diamond Staffing, Inc. as well as their clients. It is refreshing to see a company determined to satisfy both ends of its business, the client as well as the potential vendor.”

~ Dani DelleChiaie-Baldassarre, Director of Business Development, Diamond Staffing, Inc.

Q.

Q.

Q.

Q.

A supplier says:

www.expensereduction.com