Breaking the Status Quo: Rethinking your Distributor Strategy

August Consulting
Jun 3
2 min read

Over $2 Million Saved Through Strategic Distributor Tender

Client Context

Our client, a major healthcare provider, had a long-standing contract in place with their third-party distributor. While the supplier had been reliable, the contract had remained uncontested for several years. As a result, significant price inefficiencies had developed over time.

Faced with increasing cost pressures and a need for greater visibility and control, the organisation partnered with August Consulting to lead a strategic go-to-market exercise.

The Challenge

The client sought to:

Secure immediate cost reductions
Improve service quality to better support operational needs
Strengthen procurement governance and purchasing controls

Our Approach

August Consulting delivered a structured tender and negotiation strategy that combined:

Advanced Spend Analysis: Leveraging multiple data sets to identify price outliers and cost-saving opportunities
Stakeholder Engagement: Establishing a cross-functional Distributor Working Group to align requirements and evaluation criteria
Targeted Procurement Strategy: Developing short- and long-term cost reduction plans with a clear change management roadmap
Implementation Support: Providing hands-on guidance to ensure full realisation of projected benefits

Project Objectives

Together with the client, we defined success through the following key outcomes:

Improved commercial terms
Enhanced stock availability
Clear, measurable KPIs and service levels
Catalogue management and compliance improvements
Greater operational efficiency
Product and service standardisation

Results Delivered

The outcome was a high-impact transformation:

$2+ million in savings achieved across the contract term
Enhanced supplier terms, including service improvements and reduced markups
Improved governance through purchasing controls and contract compliance
Increased visibility and reporting, enabling better future planning

Final Thought

This engagement demonstrates the value of regularly reviewing entrenched supplier relationships. By taking a structured and strategic approach to market testing, the client unlocked significant financial benefits and improved operational control.

Importantly, it also created a competitive and transparent environment where suppliers were encouraged to present innovative solutions — and were given the opportunity to have those ideas seriously considered.

Want to explore similar opportunities in your supply base? Connect with August Consulting to discuss how a go-to-market strategy can unlock measurable results for your organisation.