Ferney is a Dutch buying group operating in the tooling industry, representing one of the three key buying groups in the Netherlands within this sector. Comprised of 37 members and collaborating with over 200 suppliers, Ferney's primary objective is to curtail the cost of goods sold through negotiated purchase agreements and rebates. To effectively achieve this mission, Ferney boasts a substantial team of 50 professionals within its sizeable purchasing and logistics department. Michiel Remigius is their financial manager and is financially responsible for the whole group. With an annual turnover of approximately €275 million and purchasing power of €300 million, Ferney maintains a strong presence in the industry.
Rebates Drive Membership
Rebates play a crucial role as one of the primary revenue sources for members at Ferney. The company places great emphasis on their registration, aiming for a thorough and precise record of these rebate agreements. This process encompasses meticulous initial registration and swift subsequent updates. Once completed, Ferney enters the crucial phase of collecting on these rebates.
Remigius says, “The ultimate aim, of course, is to allocate these accrued funds to our members. As a member-centric group, this step is of paramount importance to keep our members content and happy.”
Their Success Is Our Success
When the market is on an upward trend, Ferney’s aim is to extend rebate opportunities and maximize them as effectively as possible, whether for the collective benefit of their members or tailored to individual members. An annual rush occurs around November and December as their members are eager to assess their expenditures, questioning if there is a need to place additional orders.
Remigius says, “We strive to become increasingly reliable and precise in aligning our strategies with the revenue fluctuations, all with the overarching objective of assisting and benefiting our members. Their success remains our foremost priority.”
Ferney deals with a diverse array of rebate types, including group bonuses, individual bonuses and various combinations thereof. The complexity of managing these rebates is notably high due to the intricate nature of the agreements. This complexity arises from the presence of numerous inclusions and exclusions that form the foundation of these rebate arrangements. Also, their suppliers often have distinct goals.
Remigius says, “For instance, consider a company’s desire to bolster their presence in the gardening tooling sector by offering higher rebates for those products. This dynamic adds another layer of complexity for us since we don't have up-to-the-minute product information for all transactions. While we maintain a substantial database, it's impossible to have comprehensive data on every single product and transaction, which further compounds the complexities of our rebate management.”
Spreadsheets are a versatile and valuable tool, but they do come with a higher risk of errors that can lead to the dissemination of incorrect information for Ferney’s members. Mistakes can occur due to glitches within the spreadsheet itself or human error, resulting in additional work and inefficiencies.
Remigius tells us, “In the financial realm, accuracy is paramount. Every finance professional aims for a near-perfect forecast, usually with around a 95% certainty level. Throughout my career, I haven't encountered a situation where I had to restate financial accounts, which is a positive aspect. However, the devil is in the details. The impact of even a small inaccuracy can be frustrating for an individual member, such as ordering slightly too little, which could ultimately cost them significantly.”
Collaborating Efficiently with Members
Remigius says, “The collaboration side of Enable is working quite smoothly. It's very user-friendly and easy to onboard new members, as long as they have some basic computer literacy. My initial impressions are positive; the members are having no trouble collaborating, which is crucial for attracting and retaining new members in our buying group. Although we don't see a lot of new members joining when market conditions are stable, I still believe it's a very important aspect of our buying group operation.”
He continues, “I can only hope to see and hear from our members that they receive timely information that empowers them to make informed decisions, ultimately leading to greater satisfaction and happiness.”
Driving Member Transparency
Transparency is of paramount importance for Ferney as a buying group. Remigius tells us, “With Enable the goal is to openly share information and any actions, with our members. This transparency serves as a vital communication tool, enabling our members to understand the steps we are taking and how it contributes to their progression within the rebate tiers.”
Accessing Data Independently
Three years ago, Ferney recognized a shift from merely pushing information out to enabling their member customers to pull information themselves, allowing them to access data independently.
Remigius explains, “At Ferney, we used to distribute PDFs to our members every month. This involved manually gathering the data, inputting it into Excel, converting it into PDF format, and then sending it via email. Now we can provide this information at their fingertips. While they may not check Enable every day, the availability of information adds a level of professionalism to our buying group. It's about offering the convenience of immediate access, which, in the long run, can build a sense of trust and reliance among our members.”
The Enable Team are Highly Capable and Helpful
Remigius tells us, “The onboarding process went quite smoothly; it was efficient and effective. Although everyone was working remotely, it worked exceptionally well. The Enable team are highly capable and very responsive, operating within a quick turnaround time. This helped our efforts. Enable helped us in acquiring all the necessary agreements, which was a tremendous help.”
Completely Digital Agreement Creation and Sign-off
Remigius says, “We aimed to implement a contract management system along with a rebate calculation system, and I'm pleased to report that we've achieved success on this front. We now have our contracts securely stored within the system, giving us the capability to monitor and track changes as needed. This is a significant step forward, as it allows us to collaborate seamlessly with our suppliers.
He continues, “Looking ahead to the next season in 2024, we anticipate a fully digital process. Gone are the days of printing agreements and signing them manually; everything will be efficiently managed within the digital realm. This transition represents a notable advancement in our buying group operations.”
The level of data literacy and maturity is of utmost importance to Ferney. That's why they utilized Enable’s data transformation services. This valuable information established a solid foundation for data processing and ensured the accurate categorization of products for Ferney.
“By improving our data quality, the system's calculations will become more accurate than they are at present. From there, we can progress our members to higher rebate levels, but if the initial data quality is subpar, it can hinder their progress. Without individuals on your team who grasp the intricacies of data and its implications, the onboarding process can become quite long. The Enable team is luckily well-versed in their field, when it comes to your data, they understand how it should be properly interpreted.”
Michiel Remigius | Finance Manager