How to Fix Internal Procurement Inefficiencies: Identifying Rate Variance Across Plants with Genie 2.0

Have you ever wondered if you are paying different prices for the same item across locations?

One of the most common inefficiencies in enterprise procurement is inconsistent pricing for the same item across plants or business units. Without item-level visibility across the organization, this often goes unnoticed—leading to silent value leakage, fragmented vendor usage, and misaligned contracting opportunities.

The above inconsistencies are most prevalent in Indirect Material specifically in the category of MRO.

VENDX Genie 2.0 gives procurement buyers the visibility they need. It highlights plant-wise rate discrepancies for any item, shows vendor-level performance trends, and helps build a case for consolidation, contracting, or process alignment & avoid Maverick Buying.

Why These Inconsistencies Happen

1. Plant-Level Procurement Autonomy – Each plant may negotiate separately without visibility into enterprise-wide procurement history.
2. No Item-Level Rate Visibility – Teams rely on the last purchase price or vendor quotes, without historical benchmarks.
3. Non-Standardized Vendor Use – The same item is often sourced from different suppliers in different locations at different rates.
4. Lack of Procurement Governance – Frequently purchased operational items fall outside strategic sourcing reviews.

How Genie 2.0 Helps Fix Fragmented Buying Patterns

1. Reveal Plant-Wise Rate Variance for the Same Item

Genie, our Gen AI procurement assistant surfaces the highest, lowest, and weighted average rates paid for a specific item—across plants, vendors, and time periods.

Example: For “MRO Coupling Set A,” Genie shows 56 transactions across four vendors and three plants, with prices ranging from ₹138 to ₹182.

2. Compare Vendor Behavior Across Locations

Genie allows procurement to evaluate how the same vendor is pricing the same item across plants—highlighting inconsistencies that may otherwise go unnoticed.

Vendor X supplies to three locations. Genie reveals that Plant A consistently pays 12% more than Plants B and C for the same procured items.

3. Support Internal Alignment for Contracting

Genie provides the data required to justify preferred supplier programs or rate contracts for frequently purchased items.

Procurement can now align all plants around a supplier who has consistently offered competitive rates and reliable supply performance—backed by data.

Use Case: Closing the Price Gap on Hydraulic Hose Connectors Across Plants

The Challenge

A leading industrial manufacturer noticed erratic MRO spending trends but lacked a clear view across plants. One item—Hydraulic Hose Connectors—appeared frequently in audits, but pricing varied with no obvious reason. With decentralized buying and no centralized rate tracking, procurement couldn’t pinpoint the issue.

What Genie 2.0 Uncovered

Using Genie, the team analyzed 60+ transactions over the last 12 months. They found a 29% price spread for the same item across three plants. Surprisingly, the plant paying the highest rate also had the largest order volume—contrary to typical volume-based pricing logic.

The Procurement Insight

Genie revealed:

1. Vendor X quoted different rates to each plant despite similar volumes.
2. Plant B, with the lowest rate, had a long-standing relationship and a rate contract that hadn’t been replicated elsewhere.
3. Plant C frequently sourced from a higher-cost local supplier due to speed, not pricing.

Action Taken

Armed with data, procurement:

1. Centralized supplier discussions for the item
2. Aligned volume commitments across plants
3. Negotiated a unified rate contract with Vendor X, based on consolidated demand and delivery SLAs
   

The Outcome

1. Annual savings of 5.25% resulting in nearly 10.5 Crs (200 Crs/PA worth of MRO purchases)  of positive impact on the bottom line  
2. Improved supplier terms and delivery timelines
3. Shifted MRO procurement of certain items to contract there by ensuring superior rate due to volume discount and better commercial terms.

Why This Use Case Matters to Enterprise Procurement

1. Uncover Cross-Plant Procurement Gaps – Identify inefficiencies and correct them before they scale.
2. Drive Rate Discipline – Ensure uniform pricing for identical items across locations.
3. Enable Strategic Category Control – Bring contract coverage to routine but high-frequency items.
4. Strengthen Internal Alignment – Build trust with stakeholders using facts, not assumptions.

Bring Procurement Consistency Across Your Operations

With VENDX Genie 2.0, procurement leaders gain the transparency they need to manage spend more strategically. Eliminate silent inefficiencies, fix internal fragmentation, and ensure every unit benefits from enterprise-level insight.

Same item, different plants, different prices? Genie will show you where and why.

So, do you want to bring rate consistency across your organization? Book your free demo now.