Direct Material Cost Reduction Programme (DMCRP)

Request More Information

In modern times, many organisations have professionalised their direct material procurement. However, pressure on continually leveraging savings potential remains the top priority of today’s purchasing teams. RASCO’s DMCRP helps companies to achieve these savings continually in mature markets, through our well established and proven approach.

In our 16 years of industry experience, we have helped our clients save more than GBP 100 Million and have helped our clients in increasing their profit margin by 250 – 900 basis points.

Our Approach

Product Teardown

Product Teardown is a technical process of deconstructing a product to child part level and performing a technical analysis of every child part for its form and function.

Product Teardown studies help in understanding the constituent Bill of Materials of a product with key information on mechanical properties, material of construction, method of construction and suppliers of child parts. These studies, if done for our client’s products and/or their competitor products help in unlocking value which may yield in product optimisation, resulting in improvement of net profit margin for our clients.

These studies are the basis of Value Analysis & Value Engineering tasks.

BoM Costing

Often referred to as Clean Sheet Costing or Should Costing, is a process whereby, our team studies components for dimensions, weight, material of construction, manufacturing processes and any coatings, finishes, paints, or printing which might be applied on the part.

We then break up the costs in various heads, like raw material costs, tooling costs, process costs, labour costs and estimated profit margins and freight from vendors of these parts.

Our costing studies have helped procurement teams to take these costing sheets as a leverage and negotiate better prices from suppliers. These sheets also, help in understanding the distribution of value within parts. This allows design engineers to take effective decisions to optimise the design of the parts to make the overall product more profitable.

Value Engineering

Technical Insights received from Product Teardown & Should Cost Analysis when benchmarked against competitor products help in designing strategies to optimise our client’s products. These strategies help our clients to:

  • Emerge as best in class with the most optimised design, yielding highest profit margins for our clients.
  • Get better value for their USP features
  • Get rid of obsolete features
  • Deliver the best product at the best price

We conduct “Cost Down Workshops” to help our clients understand the ideas we generate for Value Engineering & assist them in implementation of these ideas.