31 March 2009 | Jake Kanter
Siemens is to ditch a fifth of its suppliers this year in a drive to simplify its spend.
A spokesman for the electronics and engineering giant told supplymanagement.com that the company had 300,000 vendors delivering only 5 per cent of its annual spend of around ?40 billion (£37 billion).
He said it would axe 20 per cent - or 74,000 - of these to reduce complexity and improve flexibility and delivery.
The German firm will work more closely with its remaining vendors to reduce costs and boost innovation.
Siemens introduced a number of new procurement projects in January, including centralising areas of indirect and direct spend.
The spokesman said savings targets for the buying changes would be announced in its second quarter financial results at the end of April.
Head of supply chain Barbara Kux became the first woman on the board of Siemens last year (Web news, 14 November 2008).