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Lloyds banking group makes substantial savings on mailroom procurement

  • Redundant mailroom machinery audited, repaired and put back into use rather than unnecessary investment being made into new machinery
  • Massive savings made on mailroom consumables because as a manufacturer themselves the supplier could provide high quality products at competitive prices
  • Supplier goodwill meant many extra services were provided free of charge

 

David Hymers, Managing Director of Totalpost Services Plc.

The Group Property division of Lloyds Banking Group (Group Property) recently revealed that they had saved a six figure sum on mailroom equipment maintenance and supplies since they began working with leading postal services and equipment company, Totalpost Services Plc.

THE ISSUE
The Group began working with Totalpost in 2008 because they wanted to streamline postal supply services, consolidate the number of suppliers being used and to reduce costs.

THE SOLUTION
These savings have been made through the following steps.

Consolidating suppliers
Totalpost began by supplying a mailroom maintenance contract which consisted of the delivery service of mail openers and extraction desks. Initial success led to a single source responsibility contract which meant that Group Property were able to consolidate their suppliers for this area of the business from around 8 down to 1. This led to a reduction in costs and management time, and also ensured that only a single renegotiation of contract was required each year. Synchronisation was achieved through Totalpost’s flexibility in accepting additions to the contract and pro rata’ing the first year value of new contracts to come in line with others also led to significant efficiencies.

Machinery audits and redeployment
Upon winning the mailroom equipment and maintenance supplier contract Totalpost embarked upon a large scale machinery audit and visited Lloyd’s processing centres across the country to assess the mailroom asset list. This resulted in working machinery which were classed as spare being redeployed for better use, damaged machinery being efficiently repaired and put back into use and, un-repairable equipment being decommissioned adhering to WEEE recycling regulations. Following this, a phased replacement plan, over intervals of 1, 3 and 5 year periods was introduced to enable the Group to effectively budget for replacements and to ensure best maintenance practice was maintained.

Postal ink savings
Lloyds were able to make instant savings on their franking machine ink. Totalpost manufacture and supply Royal Mail approved franker cartridges and so were able to supply the cartridges at a considerably lower unit price than the price which Lloyds were already paying.

Additional savings were made through the utilisation of Totalpost’s “on demand ordering” service for consumables. This service gives customers the option to order consumables up to 4pm on any working day and receive them the next day.

Supplier goodwill
Substantial savings were also achieved because Totalpost supplied many additional services free of charge. For example, the company collected and redistributed mailroom items such as used note counters to different branches for the company for free. Additionally the company has decommissioned and collected some machinery free of charge.

THE OUTCOME
Talking about the relationship, Kevin Phillips, senior facilities manager within Group Property at Lloyds Banking Group says: “As well as supplying a service that is second to none the advice that Totalpost has given us in regard to best practice of use and re-use of machinery and the best deployment of it has been invaluable. Working with Totalpost has led to savings across the board. The combination of the next day supply of consumables along with the stock reduction and waste reduction led to cost savings of up to 55%.”

For more information visit www.totalpost.com or call 0845 4900 360
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