2025, ProcureCon MRO. Panel_Taming The Tail: Strategies to Curb Wasteful Spend

Announcer: Alright, we are moving right along and we have a great panel lined up for you. Next up, we are talking about tailspin something. I know all of you are probably dealing with, so please welcome back to the stage our fabulous moderator, Amanda Prochaska, Le Boland, Brian Sier and Julie Wirth. Give a welcome.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Okay. Oops, she's got this

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): guy. Hi everyone. I'm up here by myself. You all come in, right?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Yes. Technical difficulties.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Oh, okay. Good. All right. I could talk tail spin, but I think everyone wants to hear from you. All good?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Yes.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Okay. You guys made it to afternoon. Hanging in there. Good. Okay. We're gonna have a little bit of fun.

We're gonna talk about tail. I wanna kick it off real quick. How many of you in the room feel like you're, the tail spend is more like a dinosaur tail. Okay. We're not talking about little tiny tail here, right? MRO is very complicated when it comes to tail spend. Reminder for all of you, introduce yourself before you answer the first question.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Absolutely.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): I learned that from this morning. Okay, Lena, how are you today?

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: I'm doing wonderful.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Thank

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: you. How are you?

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Good. What exactly is tail spend in this particular context, and why is it so often overlooked?

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Ah, tailspin. So first of all, my name is Lena Boland. I am the strategic sourcing manager with Smithfield Foods.

I've been there for a whopping five months. Oh. I previously worked for five years with another panelist, miss Julie Wir and Bush Vacuum Solutions. Tailspin is going to be your low volume, low frequency items that, that get purchased, right? So it's going to be things that are. It's 20% of your spend, but 80% of your vendors, right?

So you have all of these vendors for this little bit of spend, and you're managing these vendors and managing those spends, and it's overlooked because the spend individually is very low on these items, and they're one time buys. Or maybe you buy it. Twice a year if that, or every nine months or some kind of cadence of that nature.

And so you don't really pay attention to it. It doesn't really fall into a category that you've already managed it or you already have contracted, but it's there, right? And every day it's happening. And you're adding a new vendor because somebody needed some teeny tiny, I see it a lot on electrical parts for my maintenance, repair people.

They need a particular fuse that never blows out until it actually blows out, right? You see it on these little items, and it could be something, it's a inch big, it costs $150, like whatever. Just buy it. So we can keep the plants open, we can keep the doors running, and we're not really capturing that.

That spin, we're not really seeing the effect that has on our overall MRO spin category.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): There's a lot of leakage in there too. I have a feeling.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Absolutely. Yeah. It's totally unmanaged and it's just loosely categorized and it's a big, it can be a big thing on your bottom line.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yep.

Absolutely. Okay, so Brian, let's go into some more around the characteristics of tail spend. And the tailspin related transactions in MRO.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Remember to introduce yourself.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah. Brian Fuser I'm the category lead for MRO with Huntsman. I've been doing strategic sourcing now since I've been with Huntsman for about three years.

Before that I spent about, 10 years in a small manufacturer doing kind of transactional, just day-to-day purchasing. And before that I was in selling MRO supplies with. With Fastenal, some of y'all might have met him today. So yeah, I, common characteristics of MROI, let's start with, okay.

In a perfect world, a world class well-managed MRO organization your tailspin is going to be anything that's not being purchased from your strategic suppliers. That you have, your core suppliers that you're really focused in on, on managing the spin and managing the KPIs. But we all know we don't live in a perfect world.

So in reality your tailspin and I'll disagree with Lena a little bit, it's not just simply a low spend or a low frequency transaction. It's a little bit of, it's a little bit of all, so you, yeah, you certainly are gonna have your low frequency vendors that you only buy from one or twice a year, low spend, but you might also have a low frequency vendor that you're spending significantly with, two times you're spending $50,000 a pop or vice versa.

A high frequency spender, you buy a hundred times a year with them at, 200 times each. I suggest finding a balance, what makes sense for your business. When I looked at it for ours I don't want to say I don't want to I made an algorithm, maybe not, I'm not really that smart, but I figured out a way to, to find the balance in between what was the low frequency high spend and the high frequency, low spend to identify what what tailspin really looked like for Huntsman.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): And I'll ask this to all of you. Is there like a certain category where tailspin shows up more? Is it in. In more of your parts, areas, services, both. Does it really matter? This was an unscripted question.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Yeah. A lot in maintenance. I find maintenance a lot in maintenance mainten. 'cause it's sometimes they're emergency, little small spends.

As well, I just did a p card analysis on all non-travel spend with with P cards and found that there's a lot of there are a lot of people run into the store for this, that, and the other, or. Buying from online or one up to Home Depot or whatever, instead of buying from the strategic suppliers for maintenance type things.

Okay. That's one experience for me.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yeah. Maintenance is definitely one of the biggest abusers, I think, in the tailspin category, but weirdly enough you find a lot of it in office supplies too. Like just office supplies or janitorial supplies, paper towel, things like that.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah. Break room supplies.

That.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Break room supplies is another great one. You're all of a sudden you see $80,000 that you spent in like plates. You're like, what plates? Why are we buying so many plates this year? And it's if they were in the break room for one thing, and they were like, oh, now we have plates.

So they kept buying plates.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Maybe we had a party, but they didn't, say don't buy plates anymore. But

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): yeah, they kept

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: buying plates. All

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): right, good to know. And welcome everyone that just joined us. I know we got started a little bit early. We started rocking, rolling in here. So welcome everyone.

We're talking tail spend if you haven't caught that on yet. So Julie, you're next up and remember to introduce yourself, but we've already defined what tail spend is, but why does it require a different approach?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Okay hi, I am Julie Wirth. Strategic sourcing manager at the Bush Group Bush Vacuum Solutions, and I've worked with MRO for, gosh, probably about 16 years but not really focused on it until working with Lena, where she came in and helped me really.

Focus on it, look at that tail spend and she really took the lead on it. I changed jobs about two years ago and now I'm very focused on it. So it's somewhat of a new category for me, but not really. And I guess you do have to take a little bit of a different approach to tail spend.

It's not the same as you would take for your high spend, strategic. Items excuse me. So I think what you have to do is you have to look at it a little bit differently because it's not always going to be easy to lump it all together under one strategic supplier. Yeah. You have to take a look at it from the standpoint of satisfying everybody's needs for these little one-off items.

And try and get them if you can, to a single or a small group of suppliers or a category supplier of some kind. But it's not always, it's not always easy to consolidate.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: I would have to say, I don't know if you guys have

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah. And we were talking in the prep for this panel that.

All of you have different approaches to how you're managing your tail spend, and we'll probably get into that in some of the answers today. But I would challenge, I would ask, not challenge, that's not the right word, but I would ask all of you if you want specifics from each of these panelists and what they're doing with tail spend.

If we don't touch on it throughout the questions, feel free to network with them. They have some really great solutions. So Brian, okay, you ready? Ready for this? Because this one I think is a big one. What are typical challenges in tracking and managing your tailspin, including implement implementing solutions to solve for it?

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah. So speaking, at least from my experience starting at the beginning, choosing your solution there's all kinds of solutions out there in the market. They range from doing it yourself. It certainly is within the realm of possibility. To do it yourself, just depending on the complexity of your supply chain and your organization.

And then there, there's also various third party options, several of which are here today. And then within those third party options they offer lots of different spectrums of how they offer their service between a, a purely digital, online platform to, you've got somebody there in your site.

Taking over certain portions of labor for you. So choosing the solution is the first challenge. Often, with anything, implementation is a giant challenge, and I'm sure y'all are. Familiar with all these typical hurdles of implementation, communication making sure that everybody that needs to know knows what's going on.

You're gonna have your typical stakeholder objections, your protective guys that are like, I don't want you to, if you're, if you choose to outsource, I don't want you to outsource this guy because he's been doing business with us for X amount of years. So you also, you always have that, res suppliers are also resistant. If you're using a third party, they're often gonna have their own business relationship with those suppliers. And, your suppliers may not be agreeable to that particular relationship with those. And then, the other challenge after you get done implementing it is actually tracking and managing it, where do you get the data from? If you've done a good job, if you've if you've identified a good solution, that solution provider should have that data easily, readily available for you in an easily digestible ti format. And then just finding the balance between how much time you need to spend managing it and how much time it's actually worth it to manage.

In, in lean sourcing, purchasing organizations, especially like the one I'm in, time is extremely valuable. So for when I'm looking for a tailspin solution I'm gonna want one that's more or less hands off and I can really manage like a not hands off.

I can manage like a strategic vendor once every quarter having touch bases and easily managing like that.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): My dad used to always say, if it was easy, it'd be done already. Yeah. We wouldn't be sitting here all talking about tail spend if it was something easy to do.

So Lena how significant is the financial impact of uncontrolled management of tails spend?

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: It can be very significant. When we are, look. Looking at our tailspin and the categories that we can loosely drop that tailspin in. A lot of times you'll find that you have vendors who's already, you already have relationship with.

You already have contracts with who you could have pushed a spot by through, you could have said, Hey, can you gimme a quote on this instead of going to an outside vendor or going and using a P card. And so you're missing rebate dollars, right? Because a lot of our contracts that we put into place, we have.

Spin rebates. So if we were actually managing our tailspin and managing these little small purchases that loosely fall under another category under a strategic vendor that we already have, we could be adding those dollars into that. So now you're, instead of doing that, we've went to another place, maybe had to spend money onboarding a new supplier.

We maybe had to spend productivity dollars. On our maintenance guy who's been searching for this thing online for three hours and not getting something else done, and then he is Hey, I got this. I found it. It's the perfect thing. And we just go to buy it because the machine is down and they want to get it, back running.

And he said this was the best option when we could have, if he would've brought it to us before he spent that three hours, we could have sent it to our strategic partners and said, Hey, look at this. What kind of price can you give me? Are we gonna get the best price every single time from a strategic partner?

Of course not. But there's probably somebody already in our network where we don't have to spend those dollars onboarding that we could potentially use. So you lose that volume. The other thing that you don't know about tail, these buys with tailspin is that. How the lead time is actually gonna affect this person.

We don't have a relationship with them, so we, if they, we went and we ordered something because it was a need. Now they say, oh, it'll be there in two weeks. Now, two weeks passed and we don't get it. And they're like, oh, there was a backup. Something happened. We had to sell it to one of our strategic customers.

Something of that nature. Now you're behind, right? So we could be losing money in a multitude of ways. The other thing is 15 to 30% of your tailspin can actually be included in a category that's already managed. So even if it's a small, this is not a frequent thing. They're not gonna give us the best discount on it, but it's there.

It's a available, maybe they. Stock it for us. So if there's minimum order quantities, we don't have to order a big box of something that's gonna sit on a shelf for 30 years, because we only use once or twice a year. So there's a lot of dollar, carrying costs in that. There's just the cost of missing out on your rebates.

There's the cost of all the time is spent for somebody to cut a PO for this one item. Process an invoice for one item to a new supplier. Maybe the payment terms were not perfect or not ideal for us. There's a lot of money that we could be missing in there. And the best business case is to show your stakeholders.

Hey guys. This is all that, we look at your spot buy or your tailspin items, and we found these items that you don't buy frequently, but every time you buy it from a different vendor. What can we do about this? And let me show you the money that you're wasting onboarding a new vendor every time you want to buy this item, whether it's.

Every six months, every nine months, every once a year. So there's a lot of financial impact that can be in there.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Beyond just the cost of the item.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Beyond the cost of the item. Yes,

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): absolutely. Okay. So Julie, let's get a like super practical here. Okay. Let's talk about the categories that you usually see tail spend popping up in.

What are those typical tail spend categories?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Wow. There's a long list. Certainly tell

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): if it was

short.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yes.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: The short and sweet of it is I, my, for my company, we have a lot of different service centers for the products that we provide. And there is just a lot of like I said before, maintenance and facilities type items.

Lena pointed to it a little bit with the janitorial and all those kinds of things that are that are just little purchases here and there to support the organization or to support the building. But also, if like what someone would call the golden screw, I need this specialty fastener.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: And instead of getting it from a strategic source, we go and buy it. From the nearest place down the street where we could take our PCard. It's those kinds of little things. It's you have to look for a lot of pos to, to a certain supplier for very low dollars.

You have to look for a lot of a lot of suppliers for a particular type or category of part. But a lot of times it ends up being maintenance type items in where I work. Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): It was interesting. I worked at MGM Resorts. If you can imagine like the craziness that we bought. We, I would tell people we bought medication for Dolphins all the way through.

Oh my gosh. Bulletproof Fest for canine units. Oh my. Like it was, and then obviously wine and steak and Yeah, every Cino, chips and all that. But the towel was. Absolutely massive. And it was hard to tell what was almost tail and your strategic spend at times. 'cause it was so big. Lena, how do companies assess whether their current tail spend is excessive?

Like I was just mentioning?

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yeah, so typically best in class procurement, right? You, the best situation that you're going to have is gonna be 80% of your spend is through your strategic partner. You're pushing the majority of your spin to people that you have contracts with, you have relationships with that, you, it's mutually beneficial.

The, these are my partners I can call on in a pinch. Anything below that. Honestly, if you're in the seventies, I think you're doing better than most because I think ours is somewhere around 50% maybe less than that right now. But if you are spending. The majority of your spend is with a huge group of suppliers who you have no relationship with, who you are just buying things from, and you're like, okay, I've done my Pareto chart and all of my spend is with this 900 vendors that I don't even know.

A single person at one of these places, you have an issue with Tailspin. You really wanna look at your supplier count versus. Your spend, right? What am I spending with these suppliers? Because we typically know our A, B, and C suppliers, we know those people because we're talking to them the most.

We're negotiating with them the most. And we have our contracts in place and are we, were working on value added and all of these things, but with, when you have a huge concentration of vendors, I don't even wanna say the number of vendors that we have at Smithfield is so outrageous and they're constantly adding them.

All over the place, but you have 37 plans operating individually. You have, that's 37 different plant managers and then hundreds of people in that organization, and they all think they need something. And then we have corporate who are, we're out here trying to do the best we can to wrangle in this spin, but the plant must not close its doors because you do not want the stakeholder to call, the C-suite and say.

Hey, we gotta close down today because they said we can't buy for, spot by this down the road. We have to get it through this. You don't want that phone call. You don't want that email. You don't want those things to happen. So you have to really look at how much am I spending with these?

D suppliers that are down here that, we're rarely dealing with. And you have to see, is this a problem? Am I upside down on this because my big supply base, my partners, that's where I should be pushing my spend through.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): It was interesting when not all the time. Is it a cost equation when you're talking about the tail, right?

Yes. So yes, there's cost optimization that you can do. What, in my experience when you know that it's really a problem is that you start seeing excessive quality issues.

Yes.

Or where you can't get something in a timely manner because you haven't developed a relationship with one of your primary suppliers.

So it can show up in cost for, which was your point, but it can show up in other ways too where all of a sudden you're like, oh, maybe we have a problem in this particular category. I'm gonna go back to MGM. It has nothing to do with mro, it has to do with flowers, right? If you've ever been into an MGM property of the big conservatory at the b Bellagio or flowers, all, we were having a quality issue with flowers, and we didn't have, it wasn't a strategic category for us.

It was flowers, right? So we took it out. We looked at. The best of the supply base out there and really focused on quality and hopefully got a better product. But that was considered part of our tail.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: And what's really crazy, so if, and the other thing you would notice is that you bought, I know somebody in a panel earlier talked about buying the same hammer over and over, or it was in the Granger launch the same.

They had every single one of Granger's skews for hammers somebody had bought, but they never bought the same hammer twice. So why? Get getting down to why are we buying a different hammer every time? Did the first seven not work? What? What was going on with this hammer? And why do we have to buy so many?

You're looking at buying habits, and I know it's a big ask because who in here is not busy at all at work? Nobody. So we're all super busy. We have a lot of numbers to crunch. We have a lot of data to look at. But when you look at just overarching, how many of your suppliers. Or how many suppliers are in that big 40% of spend or whatever, and you're like, okay, let me pull back, look at this ca, look at this.

Is this a category I need to manage? Is this, is there something in here that we can push off to this per, I see this same text. I don't know if you guys deal with free text pos. We do a lot. Especially

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): in the tail.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Exactly. Especially in the tail, because there's no part number. So if you're seeing the same text pop up all the time.

And every time it's at a different supplier. These are things you wanna pull out, look at your data and pull out and say, okay, so I'm seeing the same keywords in all of this. We need to do something about this item in particular. We need to get this off into a category.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Perfect. Okay, so if you all were with me this morning, you know that I'm gonna be asking for questions.

Yeah. Okay. I see some head nodding oh, is she really gonna make us do this again? We're gonna do 10 minutes at the end. So we have about five minutes of questions up here. If you can get some questions pulled together. 'cause again, this is for you, not us. And so this is your fair warning. Fair enough.

Okay, good. I got some smiles and chuckles. That works. I'm gonna skip around a little bit just so you know if you're follow, we're following up here. So Brian, I'm gonna go to you next. What are some quick wins for reducing tailspin without disrupting operations in general?

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah, so I'll agree with Lena this time, right?

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Oh, okay.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: If you can find a strategic supplier that you already have a relationship with and you're already doing business with, that can also manage your tailspin, that's a quick win. You just gotta be careful because. They're salesmen, right? They're no offense to anybody in the room that is but they're there to make money.

And although they can do tailspin, maybe they can't do it as best as what's available in the market. And then if you can find a solution or a provider and if your stakeholders are telling you this is important, if you can find a solution or a provider that maintains their flexibility to.

Still do business with that good old boy that they've been doing business with for however long. That's also an easy way to to bring a solution that puts smiles on everybody's face.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): And there's a couple of different. Options there, there's technology options where you can do that.

You can consolidate your tail spend without disrupting the actual relationship at the location. There are service providers that also can do that. So there's a lot of different ways that you can accomplish that.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah, and the good thing about that, going back to what I said earlier, is it doesn't put it all on you to figure out where to get all this stuff.

At, you can lean on the hundreds of, operations folks that you have in your organization and all their experience and knowledge of where to get that stuff. Okay, great. You can get it from that one right there. Yeah. Just send it through this this tailspin provider that we have.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Okay. Julie, I'm gonna bounce to you. Okay. And then if I have time, I'll, we'll circle. Okay. How can organizations balance, cost, control with the need for flexibility? In this space? I think Brian just,

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: I think he touched, covered a little bit. It quite a bit. And I'll just add to it, agreeing with them.

I will add to it. I think that we all need to make sure that we're staying on top of what our vendors can do for us. There are so many vendors out there that are opening up their capacity and their capabilities. I'll give an example. I had a packaging supplier. Who was supplying cardboard boxes for us, printed cardboard boxes for us.

Okay, great. We discovered that he can also do vendor managed inventory for all of these other parts or types of items that are found in shipping. And so that was a way to manage that category of tail spend. All the shipping supplies that went into and alongside of the cardboard boxes. Now that vendor comes in and manages those things for us.

So going back to the idea of look to your strategic suppliers and see what they can do there's, there are a lot of suppliers out there that can they don't just supply your tails, spend items. They can take the data and analyze it for you and deliver back to you, for a better price that has a value to it, so I think that's something that, we all need to keep in mind and even not even the big names. Some of the folks that you think can't do these kinds of things, ask them. They're known suppliers, your stakeholders like them. If they can do some additional, whether it's data analysis, or vendor managed inventory, or even just stock for you, certain.

Certain things that's gonna help a lot. And when it comes to, to tail spend it, it becomes a little bit more of a challenge. But you never know until you ask.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): I love that because you know what, suppliers want to help, right?

They obviously want to make money too. Yes. But being a procurement person now, supplier ish person, it, we love solutioning to help our clients.

So if you just ask the question. Usually you're going to get at least some direction of what they're seeing with their other clients if they can't do it, a recommendation or a solution directly from them. That's a great point. Okay, we have two minutes left before we take questions and round, round us out.

Lena, I'm gonna, can I skip down your bonus question? Is that okay or do you Sure. Okay. I

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: can remember what that

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): All right. Because I think it goes along with what we were just saying with suppliers. So how can cross departmental collaboration improve tail spend management? Okay, so we just talked about collaboration with suppliers.

Yeah. Yes.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: So we all know our stakeholders, right? We work with them every day, and they are the most difficult people in our lives, right? They're more difficult than our children, our dogs, whatever. Your stakeholders are the ones that are combating you 24 7, right? So we are not only building, I have a talk tomorrow about supplier relationship management, but we're not only building those relationships with our suppliers.

We need to build those relationships with our. Stakeholders. We need to educate them and communicate with them. And I am sorry to all of the salesmen that are in here right now, but I'm gonna tell, teach them what not to say to the salesmen, right? So like we have to have these conversations with our internal people and get them on the same page as sourcing.

And they hate it, right? They don't want to, they don't care about that. They want what they want, when they want it. But if we communicate to them the impact of what. This is doing to our spend, what it's doing to their budget, how much more money they will have in their budget. If we can con, if they can control their tailspin, they're more likely to be on our side, right?

Because it's gotta be mutually beneficial. We can't just go in and say, because sourcing said so. This is what you need to do. They don't know our goals, they don't share our goals. Maybe give them some KPIs. I'm sorry if there's any stakeholders in this room, but maybe give them some KPIs that is tied to procurement.

I know that takes a lot in our organizations. We've gotta get upper level approval to tie somebody else's fate to how they, they manage their budget. But it's really beneficial to put these ideas out there to say if they had a dog in the fight. They would care more about it, we would see this cost decrease.

So that just that internal communication, collaboration and letting them know that we're there for them and we want to help and we can help, that's gonna be really important to, to getting our goals met.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Okay. All right. Awesome. The time only about

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: 20 seconds over.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Oh, it's okay.

We're close enough. Alright, so time. Oh yes. Okay. That wasn't even planted. It worked out that way. All right, perfect.

Audience: Because it's been mentioned a couple of times throughout the panel for those of you that I guess the balance of the time that you take to invest in getting your stakeholders on board and the ones that really just don't want to come along, how do you decide when to cut and leave them behind?

Do you ever leave them behind? And then how do you determine when to pivot to the next group?

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Okay.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: I would say yes. You absolutely have to draw the line in the sand somewhere, right? You are not gonna have 14 meetings with a stakeholder about this topic, and they're not listening. Do not waste your time in that way.

At some point you either have to engage somebody above that person or circle back to that person, right? I've had to do it. Especially with MA facilities maintenance, because the facilities guys are probably some of the toughest guys to change what they want to do. I'm just saying, but y yes, you wanna make the effort and you want to go through and say, let's we meet.

But if you're, and let conversation and you see it's going nowhere, end it. Don't even use the full, if you put 30 minutes on our calendar and after 15, you're like, yeah, this is not going anywhere. Stop. You know what? We're gonna come back to this at a later time and next time they have to engage you for something.

Bring that up. You want something from me now? Oh, okay. Let's go back and talk about what I was talking about, a couple weeks ago.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): There's also, I think, an option, Brian you mentioned in your answer about like having a solution that's flexible, so they don't actually have to change who they've been using.

But you can capture the spend and hopefully some of the leverage savings if you look at it that way. So I think it's also just know your culture. If you have a culture that's really focused on cost savings right now, or consolidation, skew rationalization, all of that kinda stuff, maybe it's a good time.

But if you have a culture that's, is not gonna be on board with that, there are other solutions in the market now.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah. If you got one person that's, really throwing a wrench in the whole plan with you, you can always move on and prove the concept elsewhere as well and then come back to them and go, look, I know you were hesitant but.

Look at the results that happened.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yep.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Awesome.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: We had I saw a gentleman over here. Yeah, a

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Couple people. One here. Alright, sweet.

Audience: So do you guys consider n PD and prototyping part of your tele spent within MRO? And if so, how have you addressed that with your stakeholders? Apologize about sales team and engineering, but they are my worst.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Okay. Yes. I've had to deal

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: with some real quick. NPE what? Nmp Product development. Okay. NPD. All right.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: So we have to get the samples and do all of the, those research and development things. Okay. I don't really classify it as tailspin, really. I'm putting it in that research and development is absolutely necessary.

So one of the things that we did, was, it was a pack. I can't even tell the story. I'm supposed to tell it tomorrow, but I'm gonna tell a little bit of it in case you missed that one tomorrow. But we looked at our corrugated, our boxes and our, we seen what's happening and we import a lot of the wood that makes that from Canon.

So now there's tariffs and stuff on that, right? So we're looking at how can we get that cost down? We have to go into that research and development and see we're using a board, a third grade board. Can we take, use a less board and. That to me is, it's specific and we have a budget for it.

Like we have a budget for research and development and for prototypes and that kind of thing, and we are putting that spend in there and usually you can forecast and plan for it. So like tailspin, I can't really for, typically you can't forecast and plan your tailspin, but if I know that there is a new project coming up or something like that.

Okay, that's in my mind. I'm already digging out what's going what. Vendors I can potentially use. I know because we've done research and development on this box before that it's gonna cost about $1,500 for me to take it down and get it road tested to see if my pump is gonna break, and then I can plan for that spin.

So to me, I don't consider it really tailspin because I can plan for it and I can make, the appropriate moves to say, okay, this is accounted for, kind of thing.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: I would add to that just to say that. Ideally in an ideal world, and I have a lot of experience in direct material, lots of prototype purchasing, but ideally you want to get your prototype from the production supplier, if at all possible.

I don't understand your if all your company does is prototype. I'm not sure. You do not? No. Okay. So ideally, you involve your vendors up front when you're gonna need a prototype so that you can get a prototype from your ultimate vendor. And I think your example, you probably did do that get prototype from, for the packaging, from the from the production vendor.

So then it goes into the r and d budget as opposed to a tail spend number. I, that's been my experience. Yeah,

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: sure. Using a tailspin solution to. Can be a bridge between when, like for Huntsman, we're sending samples out to various labs, to test what's going on in those samples.

I don't wanna have to set that vendor up every new vendor, every, testing vendor up and negotiate their terms and stuff like that. I'm just gonna tell 'em, send it through our Tailspin solution and if we really get to a point where things are ramping up, if it hits that threshold, okay, then we will, we'll bring them on board.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): All right. Okay. In front.

Audience: How do you calculate the financial return of a solution for you to keep up with your tail spend?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: I think that when, once you've done the lengthy data analysis that it takes to get your hands around your tail spend, all those free text PO lines and things like that I think that bundling the volume together and using a.

A supplier instead of 15 different suppliers and getting leverage for whether it's some kind of a discount or better payment terms or whatever due to the volume of business, I think people can get their head around that and understand that this is why you're doing what you're doing.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): We took, we typically looked at cost, right? You had cost, the lever of cost. You had the time spent setting up suppliers. The risk around using all of those total cost of

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: ownership of a vendor.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Oh, are we going back to that? Yeah, back to it.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: But yeah. Yeah. Just a word of caution.

Before you commit to anything you really have to do your homework and understand what you really have to have that answer before you pull the trigger on anything. Because otherwise you'll find yourself at a point of no return and maybe you're looking at the numbers and going, you know what, this really isn't, this really isn't benefiting us. So

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: one other thing you want might wanna look at. How many pos were you cutting before you started working on your tailspin? Because I noticed when we started to really get into our tailspin and break off some of those categories and put it with our sourced vendors, we cut a lot less pos than we did in one year than we did the previous

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): period and process.

Probably less invoices on the back end too. Absolutely. Yeah. I think we have another question up here in the front. Oh, you're gonna round us out again? Maybe. Okay. A twinkle in his eye. I know he does have a twinkle in his eye.

Audience: Nina, I'm sorry. I'm a former maintenance manager.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yes. Don't kill me. God

Audience: bless you.

And based on that I'm under, I'm wondering is there a threshold that in terms of calspan, you put someone that will manage justice because at some point the workload becomes. Heavy. Okay?

In terms of the analysis, in terms of working on you take the example, like talking with the maintenance guy that instead of buying to anyone, if he would've consulted us, we would've guided him to someone.

But in that case, how, as a corporate team, more central team, where I envision you do more strategic things, you become more tactical and transactional.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: I guess it would just, yeah, it just would depend on the organization, if you've, yeah, if you've, if you're a $50 million spending $50 million, a hundred, $300 million and that tail spend is

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: significant,

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: no.

Yeah, 78, it's all, hopefully not 78% of that. But yeah, I mean it

Audience: would you consider, for example, you pay an FTE equal x. And what your potential saving will be. X and in that case, yeah, I don't see, Y

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: not, yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah. I mean think

Audience: there's also the point is how you want your team being more focusing on the strategy that after you losing too much time on doing transac transaction tail and tactical thing.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Audience: And then after you lose your sight of building your strategy,

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): there's also a concept of a buy desk. I don't know if any of you use it for other categories within indirect, but. You can certainly have a concept of a buy desk that helps support MRO tail. Because that's the whole point about it.

It's like you have people who are managing the tail, but they sit more in a desk and share the work. So it might not be a full FTE, but they share back and forth.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: I've been part of an organization that had, centralized purchasing way over here, but they had what they called a 9 1 1 buyer at the factory.

To handle those tail spend items. And they still were in tune with the centralized purchasing organization and what the strategies were and everything and work together. But you had somebody focused on the urgent emergency.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yeah.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Do we have any more time? Oh, sorry, I didn't, do we have more time for que Are there any other que We started early so you guys get bonus time.

Yeah.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Last little thing I'll say about that though. You. I know that it would take we don't want to become the tactical buyer, right? Because we're strategic. Yeah. But if they're telling me, if my maintenance guy says, oh God, the capacitor just blew and I need this very special capacitor and blah, blah, blah, blah, blah.

The only thing I'm gonna do is take his specs that he's given to me for. Thing, and I'm going to email it out to my strategic partners who operate in that space. And that's only gonna take a few minutes. So they're either gonna come back and say, sorry, we can't do it. We don't, I don't have a supplier for this, or something like, or they're gonna come back and gimme a quote, right?

This is the spot by system. Or that. Vendor that I have in and does vendor manage inventory that's on our floor a lot. I'm gonna have that person say, Hey, take a look at this and let me know if you can do something with that. So I'm not gonna research and go through what he was doing and for the several hours that he spent looking for that item.

But I am going to try to do it strategically first before we go out and say, okay, this is a tactical thing. We have to go and find this somewhere else.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Alright. Any other questions? Before we wrap? Yes.

Audience: It's a two part question. So my company I work for Dexcom, and we use preferred suppliers. We have punch outs.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yep.

Audience: You mentioned a couple of things. You mentioned PCard. To me, it's like I'm saving tons of money and then my boss says, somebody's adding a supplier. Why are you lighting 'em? And I'm like, really? I have to deal with that right now. So my question, and I want to do, I come from another company where we use PCard, just give 'em a PCard, so then go to Home Depot and then I'll worry about it later.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Yeah.

Audience: What's your policies of your company for Pcards? For Tailspin?

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Our each service center has their own PCard. And there are a lot allowed to use it as they wish right now, and what I'm trying to do is corral them into using it with. A vendor that I'm trying to set up with a strategic account, a business account where we get a discount.

So go ahead, keep purchasing from Home Depot or Amazon or whatever. But let's have let's consolidate all these purchases instead of everybody opening up their own account, set up a, an overarching business account, a parent account with child accounts for each service center, that kind of thing. That's the approach that we're taking for those PCard purchases.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Okay. Anyone else?

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yeah. RP card. I don't even wanna talk about it. It is very depressing right now. So we have a lot of tailspin on RP cards right now, and I have not. I've only been there for five months, so next year I'll have some solution for you. But right now it is all over the place and I feel, I absolutely feel your pain.

The biggest thing again, I think is communication, right? If you have something already in place, and you can see that with their P Card spin, all of our stuff goes through Concur. So when we get those reports and say, oh, they spent all of this at Home Depot, Amazon, it's whatever. I can look at that.Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Total it up and send a blanket statement out to those plants and say, just so you know, your PCard purchases for these items where we could've bought 'em through here or here, they tallied this amount, but you could've, and I can even do a quick analysis on that kind of thing.

Say you probably could've saved 15% if you would've went, through our contracted suppliers

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: and not had to upload that receipt.

Lena Bowland, Strategic Sourcing Manager, Services - Smithfield Foods: Yes. And do all of the things that you have to do when you have Concur. One

Audience: more. You said there was more

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: two part.

Audience: Yeah. So you mentioned a, the gentleman in the middle, you mentioned a tail spend supplier.

Yeah. So one of the things is we use the, the Reese, I won't say any names, the resellers of the world, and punch outs. And I try to direct 'em there, but there's always those that are hard to get right. We don't know our engineers, you'll go to McMaster car and all that stuff.

But do you use like a consolidator or a broker as part of your strategies for any of you?

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: So we use it's a third party that basically we tell the third party what we want to buy, our people at the site, they know what they wanna buy. They go out and they find it maybe from the manufacturer, whoever, and they get a proposal and they go, here you go buy this for us.

That, that's strict. That's pretty much strictly what they do, it avoids all the lengthy. New supplier set up and contract negotiations and assuming that, that OEM or whatever will play ball with the third party.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah. And it's more of a technology solution.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yeah. Yeah.

It is more

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): of a technology

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: solution

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: or GPOs, I learned a lot about, I think last time. A G one of these. Yeah. A GPO could be something that's handy.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): Yeah.

Brian Fuselier, Category Lead, MRO – Huntsman Corporation: Yep.

Julie Wuerth, Strategic Sourcing Manager – Busch Vacuum Solutions: Group purchasing organization.

Amanda Prochaska, Founder & Chief Wonder Officer – Wonder Services (Moderator): All right. Thank you. Thank you all for being such a lovely panel. Thank you. Thank you all for staying with us a little bit longer.

Yes, it's a great conversation. Please feel free if you have follow up questions or anything like that, reach out to these lovely individuals in the hallway at break and pick their brain more. Thanks. Have a great afternoon.

Thank

you.