A global manufacturer with seven manufacturing locations engaged K2 Sourcing to support a pilot sourcing initiative focused on CNC machined components. While cost pressure, tariffs, and supply risk were increasing, the organization lacked the internal capacity to run a highly leveraged global RFP. Stakeholders across the plants were already stretched supporting day-to-day manufacturing, and there was limited time to build the supplier reach, cost models, and negotiation structure needed to drive meaningful results.

For the global corporate sourcing leader, the decision to bring in an outside partner carried real risk. A poorly executed strategic sourcing event could disrupt stakeholder relationships, damage credibility, and distract manufacturing teams. At the same time, there was broad recognition that the global risk exposure required mitigation and the opportunity for savings needed to be leveraged. The organization decided to use K2 Sourcing to facilitate the global RFP.

K2 Sourcing began by meeting with procurement leaders at each of the seven manufacturing locations to organize the plan, project governance, understand stakeholder needs, and begin the RFP process. The objective for corporate leadership was to demonstrate a methodology that supported manufacturing without disruption while demonstrating the value of a more structured, enterprise level sourcing approach.

Using K2 Sourcing’s global supplier database, analysts, and local presence in 14 countries, a large pool of qualified CNC machining suppliers was identified and engaged across multiple regions. Each supplier completed a structured RFI and had to meet defined standards before advancing. This ensured that only capable suppliers participated, reducing risk for internal stakeholders and building confidence in the process.

Pricing was collected on an EXW basis for each supplier and each item, allowing base prices to be understood separately from logistics and tariff assumptions. This is vital information when planning scenarios for long-term tariff changes. Using Cloud Source, K2 Sourcing’s RFP and reverse auction application, total landed cost models were applied to each supplier. This approach provided clear, comparable benchmarks.

Several rounds of competitive negotiation followed, supported by data driven benchmarks and scenario analysis. Incumbent suppliers were challenged alongside new global entrants, leading to improved pricing and stronger commercial terms. As the supplier pool narrowed, quality validation was completed through a combination of physical and virtual plant audits. In Vietnam, K2 Sourcing local team members conducted live virtual plant tours while the client’s quality participated remotely, asked questions in real time, and directed follow up reviews.

The pilot exceeded expectations. The client achieved greater than 20 percent savings in total landed cost for the CNC machined components category. The organization onboarded new qualified suppliers, captured meaningful concessions from incumbents, and materially reduced exposure to China related sourcing risk. Just as importantly, stakeholders noted how little disruption the process created, allowing them to remain focused on running their operations.

Based on the success of the pilot, executive leadership approved funding to expand the program beyond the original scope. What began as a cautious test became a broader strategic initiative, extending the strategic sourcing approach to additional manufacturing locations and categories.

This engagement proves how a well-managed pilot strategic sourcing project can reduce risk for procurement leaders, deliver measurable results quickly, and build the internal confidence needed to scale strategic sourcing across the enterprise.