Your Business Objectives and Initiatives Continuous & disciplined approach to cost management Grow without huge increase in headcount Cost Reduction Actionable visibility over company wide spend Adequate process documentation / audit trail Manage supplier and AP risk Risk Management Drive out cost quickly from newly acquired operations Ramp up new stores / operations quickly Speed of Business This is a template…customize for your situation….

Establish Measurable Success Metrics Value Driver Current Baseline Target KPI Improve Spend under Management $200M addressable spend 40% under management 10% average savings 80% to 85% spend under management Reduce Budget overspending 1% “overspend” 50 to 75% reduction Increase Savings from early payment discounts 2% early payment discount 5% spend eligible for early payment discounts 10% to 15% spend eligible for discounts Reduce overpayment to Suppliers 0% of spend recovered from suppliers due to erroneous payments 0.1% to 0.2% of spend recovered from suppliers Lower PO processing cost 20,000 PO processed / year $30 processing cost / PO 40 to 50% reduction (Aberdeen benchmark: 50% reduction) Lower Invoice processing cost 60,000 Invoices per year $20 processing cost / Invoice (Aberdeen benchmark of $15.61 for “middle 50%”) $5-$6 per Invoice (Aberdeen benchmark of $3.09 for best-in-class) This is a template…customize for your situation….

Critical Metrics for Source to Pay Procure Pay % of suppliers with 80% spend Tail spend as % of overall spend Contracted spend as a % of overall spend % of spend through preferred suppliers % of spend through auctions and events # of active catalogs # of active contracts # of active suppliers % of spend under management (i.e. buying at negotiated prices and terms) Lost savings because of contract non- compliance (%) % over / under budget Cost of processing PO PO processing cycle time % of PO sent electronically Early payment discount capture (%) Cost of processing an invoice Invoice processing cycle time % of Invoices received electronically % of incoming invoices with inaccuracies This is a template…customize for your situation….