29 March 2001 | Liam O'Brien
Royal Bank of Scotland (RBS) is targeting more areas of purchasing for savings as it continues to reduce its £2 billion procurement budget.
A major review of purchasing in the wake of RBS's takeover of NatWest last year has netted substantial savings, including a 40 per cent cut on lift maintenance, Ed Smith, group purchasing operations director, told SM. Areas under scrutiny now include media services, stationery, information technology, security, cheque-book production and building services.
News of the post-merger savings comes shortly after the bank announced that it was to auction more than £70 million-worth of its purchasing with FreeMarkets, an online auctions operator.
RBS said the year-long move was a toe-in-the-water exercise, and would tackle spending on mobile phones and utilities.
Purchasing at the combined bank was expected to deliver annual savings of about £75 million, with a focus on reducing the number of suppliers.
RBS currently employs 100 purchasing staff, about two-thirds of the total employed by the banks before the merger. The losses have come mainly from redundancies and inter-departmental moves.