SAF-HOLLAND
SAF-HOLLAND - More.de AG
SAF-HOLLAND - More.de AG
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Risk Management – Material Cost Management<br />
<strong>SAF</strong>-<strong>HOLLAND</strong> Initiatives<br />
To compensate cost increases and gain additional savings <strong>SAF</strong>-<strong>HOLLAND</strong> runs different initiatives:<br />
Price adjustment clauses in some customer contracts<br />
Successful price increases to customers<br />
Additional suppliers to increase competition at the supplier base<br />
Bundling the volume<br />
Qualifying supplier from low-cost countries, such as China, India and Eastern Europe<br />
Running combined activities with engineering and suppliers to reduce cost of sales<br />
Development of Scrap Price<br />
€ per tons<br />
€280<br />
€240<br />
€200<br />
€160<br />
€120<br />
Jan 03 Okt 03 Jul 04 Apr 05 Jan 06 Okt 06 Jul 07<br />
Impact<br />
Scrap price increase from 2003 until now<br />
approx. 60%<br />
Impact on the total <strong>SAF</strong>-<strong>HOLLAND</strong> sourcing<br />
volume approx. 2% p.a. (Ratio 10/1)<br />
Steel prices are largely based on 2 to 3 year<br />
contracts<br />
Quarterly average<br />
Monthly Price<br />
Sales 80% of COGS are material costs - Control of material costs is a key management focus<br />
29 <strong>SAF</strong>-<strong>HOLLAND</strong> CMD Updated 7 January 2008
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