Sara Lee shows benefits of smart procurement

Food giant Sara Lee Corporation has revealed that an ongoing efficiency program that targets areas of business including supply chain has delivered savings of $194m since the beginning of fiscal 2009.

The program has been described by the company as a cost savings and productivity initiative focused on outsourcing actions, supply chain efficiencies and organisational simplification.

The company highlighted its rewards from this supply chain efficiency in a statement.

"The company has revised Project Accelerate benefits and costs to exclude the North American Fresh Bakery business. Ongoing cumulative benefits realised from the beginning of fiscal 2009 to date are $194m, of which approximately $50m are incremental in the first half of fiscal 2011. At the end of fiscal 2011, Sara Lee expects cumulative ongoing benefits of $220 to $240m. By the end of fiscal 2012, the company expects annualised benefits in continuing operations of $300 to $350m," Sarah Lee stated.

The company added that expects Project Accelerate costs in fiscal 2011 to be approximately $30 to $40m and minimal charges in fiscal 2012. In total, project charges will amount to approximately $280m from 2009 to 2012.

The savings this project generated were revealed as part of Sara Lee's second quarter results for the period ended 1 January 2011, which saw adjusted net sales rise 1.8%. According to the company, this growth was driven primarily by gains in its two strategic growth businesses, North American retail and international beverage.

Read more here.