Westfall Technik Tackles the Ultra Competitive Procurement Marketplace of Plastics Manufacturing with Arkestro’s Predictive Models
%
savings in first event with incumbent supplier
saved on commodity resins bid
“I was apprehensive at first of trying predictive procurement. But when I saw how easy it was for our suppliers and how fast it created a business impact, going predictive with Arkestro became a no-brainer.”
David Schultz, VP, Chief Supply Chain Executive at Westfall Technik
The Challenge
Streamlining sourcing stressors
Westfall molds hundreds of millions of parts at multiple US locations per year that requires tens of millions of pounds of different plastic resins. Sourcing for specific products to make their proprietary blends was costly and slow. They needed to streamline their procurement process – quickly.
Immediate supplier savings
Within 72 hours, Westfall saw an 18% savings with an incumbent supplier who had previously assured that, “I am giving you my best price.” Arkestro ingested internal company data leveraging Arkestro’s machine learning capabilities and predictive models to simulate the supplier’s quotes before even reaching out to the supplier. They were no longer asking for a quote but suggesting an offer to their suppliers.
Overview
Westfall Technik is a global contract manufacturing company who primarily molds plastic parts on demand for more than 250 different companies. Over the past 5 years, Westfall Technik has built an impressive platform through the acquisition of over 15 companies and has seen significant organic growth through their global customers base.
The series of acquisitions made it a challenge to integrate different datasets that weren’t fully accurate or updated to the current state. While this data wasn’t the best quality – there was a lot of it – which meant really important insights were difficult to uncover and even when found, often too late.
Approach
Once David introduced the concept of PPO to his CIO and showed that there was no software to install or learn, his team was on board. The team was impressed with how highly intuitive Arkestro was, and how they didn’t have to dig through a dashboard or pull up pivot tables to know if they were getting the right quoted price from the best supplier.
“With PPO, Westfall easily accessed and enriched internal historical data with Arkestro’s predictive models and then augmented these simulations using external real-time market data. Its artificial intelligence and machine learning capabilities allow the platform to learn from the new data and resulting analytics, ensuring the most current and precise information.”
Result
Arkestro has helped to strengthen Westfall Technik’s relationships with suppliers and eliminated quote fatigue by allowing decisions to be made in a fraction of the time. Suppliers also appreciate being told how far they are from the leading offer, this transparency means they can better target their offers on the parts of Westfall’s business they are most interested in.
“As the process tracks toward an optimal commercial outcome, Westfall’s procurement team gets notified with recommendations for award allocation that takes into account the holistic nature of the supplier relationship, commercial history, and even factors like supplier risk and operational performance. What was remarkable to us was that in Arkestro, this process typically takes days, not weeks or months”
Conclusion
With the impressive results experienced thus far, David is excited for the future. He estimates that Westfall is only using one quarter of the capabilities of PPO, and is focused on greatly expanding the use of the platform across all Westfall operations.
“PPO allows Westfall to get the best pricing from preferred suppliers on favorable terms more frequently. That’s a great value proposition from my vantage point.”
FAQs
Westfall Technik
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What is the primary industry of Westfall Technik?
Westfall Technik operates in the manufacturing industry, specializing in contract manufacturing and plastic molding for over 250 different companies worldwide.
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What were the key challenges faced by Westfall Technik in procurement?
Westfall Technik faced challenges related to sourcing specific products for their proprietary blends, which were costly and slow. They needed to streamline their procurement process to improve efficiency and reduce costs.
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How did Westfall Technik address these challenges?
Westfall Technik utilized Arkestro’s Predictive Procurement Orchestration (PPO) platform to streamline their procurement process and make data-driven decisions. Arkestro’s machine learning capabilities and predictive models helped simulate supplier quotes before reaching out to suppliers, resulting in significant cost savings.
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What were the outcomes of implementing Arkestro at Westfall Technik?
Within 72 hours of implementing Arkestro, Westfall Technik achieved an 18% savings with an incumbent supplier. Arkestro helped strengthen relationships with suppliers, eliminated quote fatigue, and allowed decisions to be made in a fraction of the time.
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How did Westfall Technik integrate Arkestro with their existing systems?
Westfall Technik found Arkestro highly intuitive, with no software installation required. Arkestro easily accessed and enriched internal historical data with predictive models and augmented simulations using real-time market data.
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What is the future outlook for Westfall Technik with Arkestro?
Westfall Technik is excited about the future potential of Arkestro and plans to expand its use across all operations. They estimate that they are currently only using one quarter of Arkestro’s capabilities and are focused on maximizing its value across their organization.
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How does Arkestro's transparency benefit both Westfall Technik and its suppliers?
Arkestro provides transparency to suppliers by informing them how far they are from the leading offer, enabling them to better target their offers on the parts of Westfall’s business they are most interested in. This transparency strengthens relationships and facilitates more targeted negotiations.
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How does Arkestro's predictive procurement process differ from traditional methods?
Arkestro’s predictive procurement process leverages machine learning and predictive models to simulate supplier quotes and make data-driven decisions. This approach enables faster decision-making, improved efficiency, and significant cost savings compared to traditional procurement methods.