Materne North America Squeezes Out Significant Savings on Packaging with Arkestro
Maker of GoGo SqueeZ Uses Predictive Procurement Orchestration to Save $1 Million in Product Packaging Costs and Expand Supplier Base
SAN FRANCISCO, CA, January 16, 2023 – Materne North America, also known as GoGo squeeZ, is the global leader in “applesauce in a pouch.” As a company growing by double digits every year, Materne had two goals: first, to reduce their spend on packaging (across all sizes of cartons); and second, to expand their carton supplier network in order to protect the business as it grows.
Materne turned to Arkestro, the leader in Predictive Procurement Orchestration (PPO). As a result, Materne saved $1 million in packaging costs in a single event, and also discovered and added two more suppliers – giving them peace of mind that they’d have a back-up on every single carton size, which they didn’t have before. Arkestro is also helping Materne improve its data quality with suggested offers that automatically include correct item skus, ensuring the procurement team doesn’t have to spend days cleaning the data associated with its offers.
“Materne is looking to double in size in the next five years. To maximize this growth, we need to leverage opportunities to become more cost-competitive while ensuring the resiliency of our supplier base,” says Mathieu Pappalardo, Vice President of Materne Procurement. “We plan to use Arkestro’s PPO across more spend categories in the future, increasing the overall addressable spend we can reach.”
PPO works as a tool to enhance a company’s procurement processes. AI models analyze market data as well as data on a company’s historical purchases with suppliers to suggest acceptance parameters. This approach enhances a procurement team’s (like Materne’s) negotiating leverage through the so-called “anchoring effect,” i.e., the first offering in any negotiation anchors both parties’ expectations and the final agreed-upon price will not deviate far from it.
Utilizing elements of game theory, PPO also incentivizes suppliers to improve their offers against likely potential competitors while building trust and transparency through dynamic feedback. This ultimately leads to a lightning-fast negotiation process (traditionally the most time-intensive part of procurement). Moving faster means procurement teams like Materne can be in the “front of the line” for more suppliers more often, and accomplish more with less headcount.
“Materne has a lot to look forward to on the horizon and we are extremely excited to be along for the journey. Whether it’s supporting their data cleanliness efforts or increasing their event savings, helping their procurement team solidify itself as a critical lever for the company’s growth, profitability and business continuity is our priority,” says Chris Prall, Vice President of Customer Success, Arkestro.
Founded in 2017, Arkestro’s Predictive Procurement Orchestration (PPO), taps into the power of behavioral science, game theory and machine learning to help companies make their best buying decisions faster across all addressable spend. Top enterprises leverage Arkestro to confidently optimize their procurement cycles with direct actions and clear recommendations, managing spend at scale without increasing headcount. See Arkestro in action at arkestro.com.