Merck FIMS Agreement Case Study
Linda Moyer, Valley Forge Branch Manager met Julie Giorgi, Merck Senior Procurement Analyst (Julie reported to the Procurement Manager of Global Capital Procurement) at a meeting with Purolator to renew the existing HVAC filter contract. Linda discussed Waco's Consolidation and Leverage Services (known as FIMS or Filtration Inventory and Management Service (FIMS) which met every requirement Merck Procurement was looking to achieve in their filter consolidation initiative. The forthcoming agreement was a natural outcome; Waco's FIM's solution met Merck's consolidation objectives

Merck had a consolidation strategy to achieve cost reductions through consolidation of suppliers. As one of Merck's current suppliers, Waco was in a position to standardize and improve Merck filtration processes throughout the company, guaranteeing cost savings to Merck. Merck was further able to achieve internal efficiencies by deploying an E-commerce strategy with Waco for reduced transaction cost and lost employee time.

Waco leveraged its FIMS program over all Merck MRO filtration needs within a two month period. A key component of the successful implementation was Waco's ability to offer "same product same price" for a rapid implementation and that required no product/manufacturer changes. Through this program Waco was able to deliver to Merck a guaranteed cost reduction of 15% in the first year and 5% thereafter. In addition, Waco provides coast to coast service to Merck's North American locations (10 sites including Puerto Rico and Montreal)

A 7 step program was undertaken to implement the national consolidation:

  • E-mail announcement sent by Julie Giorgi to site procurement / storeroom contacts
  • Sales Reps called on site contacts to introduce Waco and set up roll out meeting
  • Roll out meeting held with key site personal to review agreement and decide implementation steps at site
  • Storeroom manager changes filter material masters supplier to Waco
  • Orders sent to Waco priced at last price paid. If price is older than 6 months, price negotiation may be needed
  • Waco sales rep with assistance of Waco's Director of Technology starts cost reduction process by offering substitutions to produce cost savings to Merck
  • Waco documents cost savings and meets monthly with contract manager to review progress
Alternatively, contact Linda Moyer on her cell phone at  610-202-2508