Frequently Asked Questions
How can you reduce expenses better than our staff?
The NCRC principals, Len Levey and Joe Szuba, each bring over 35+ years of cost reduction management expertise, business management knowledge and skills to you and work on every account personally. Our experience encompasses retail, wholesale, manufacturing, non-profit, and service-based businesses. Our aggregated procurement partnerships with national, regional and local suppliers enable us to negotiate the lowest costs.
How can you save us time?
National Cost Reduction Corporation conducts and manages all the communications, negotiations and due diligence. You will spend no more than 8-12 hours per year including all meetings to achieve the cost reduction benefits. NCRC negotiates cost reductions with current and alternative suppliers, and where appropriate, facilitates new vendor selection. We write the letters, make the calls and communicate with all suppliers. NCRC identifies to you compelling cost savings so that you can make the right decision for your organization.
Who do we represent?
Exclusively you, the client. We are an independent, professional third party and do not accept any remuneration from any suppliers.
How is NCRC compensated?
We are compensated by you, the client, after we bring documented and approved savings to you. We receive a percentage of the documented savings in the first year. If there are newly signed contracts, NCRC receives a percentage for the duration of that contract, no more than three years.
What is the time frame of an agreement with NCRC?
One year for existing partnerships. Newly signed agreements vary.
What is the measurement of return on this investment?
NCRC measures the return in two ways. If NCRC saves you $50,000 in the first year, you probably overspent $250,000 in the last 5 years. If you do not implement a cost reduction management plan (yours or ours), you will overspend another $250,000 in the next 5 years. That’s $500,000 of unnecessary and wasteful expense. Our cost reduction initiative will improve your cash flow, increase your bottom line and make these savings dollars available for other objectives.
What is the “No Cost, No Obligation Analysis” and how do you inform us of the range of savings?
You identify the categories, suppliers and annual purchases in each category. Within five business days we prepare a conservative annual forecast of savings. This free analysis is prepared at no cost, no obligation to you. If the savings are meaningful to you, you sign the NCRC agreement and we begin the assignment.
Is there a change in our operation?
No. You focus on your mission, revenue and growth while NCRC does all the behind-the-scenes evaluation, negotiation and vendor selection. You review our recommendations and make the final decision. All costs are on an “apples to apples” basis so there is no change to your operation. We typically do not evaluate cost of goods or labor expenses.
Are there savings opportunities from our current suppliers?
Yes. Typically 40% of the savings come from current suppliers.
Will National Cost Reduction Corporation sign a Confidentiality Agreement?
Yes. When we meet a prospect at the first meeting we always present our signed Confidentiality Agreement because we respect the value of the prospect meeting and the discussion of the clients’ business and expenses. We are happy to sign your Confidentiality Agreement.
What happens if NCRC completes the free analysis and there are no savings?
NCRC’s income is all contingent on savings to you. We typically evaluate 8-12 expense categories and within those categories 20-35 suppliers. While there may be no savings in a particular category (because you have already negotiated the lowest cost) we do find savings in the other categories. Approximately 40% of our clients’ savings come from current suppliers.
What is the relationship between us as a client and our suppliers?
We treat all suppliers as a business building opportunity. We do not “beat up” vendors over costs. Our client’s confidentiality is of utmost importance to us. We do not accept any rebates or payments from any of the suppliers we work with. We work for our clients and we make decisions on their behalf.
Why do you (NCRC) think you can improve on the job my purchasing or administrative department does now?
Len and Joe have had Profit and Loss responsibilities for large organizations with a focus on cost reduction management and cost savings. We work with your Purchasing Agents and Administrative Managers who frequently have primary responsibility for purchasing cost of goods vs. “overhead expenses.” Their primary responsibilities leave little time to evaluate every vendor. As a third-party, independent professional, NCRC dedicates the time needed for vendor evaluation. We assist your existing department to keep your company moving smoothly and cost effectively.
Can you help our company in other non-expense categories like equipment lease consolidation and background checks?
Yes. Along with competitive suppliers we have strategic partners that provide specialized services which compliment our cost reduction management program.
At the SKU (Stock Keeping Unit) level, how do you consolidate suppliers?
We review the cost of each item and prepare the benchmark spreadsheet. With our knowledge of your industries, we are aware of all current market costs.
How do you make sure we are obtaining the same or better service?
Historically, about 40% of your savings will come from your current suppliers so that your service level continues. If we recommend alternative suppliers we always meet with the potential new suppliers at their facility. We discuss and confirm your service requirements and discuss cost stability for your purchases. Then we arrange a meeting with the proposed new supplier and you. We facilitate that meeting and then work with the new supplier for the entire first year. We also check in with you to determine that all is going well with the new supplier partnership.
I’m excited and ready to begin. What do I need to do?
It is as simple as identifying the categories you want us to evaluate, all your current suppliers in those categories, and your approximate annual spend from each supplier. NCRC needs 5 business days to prepare our No Cost, No Obligation Analysis. The analysis will provide you with a range of savings. If they are compelling, you sign the agreement and we begin. Get started now by requesting a Free Analysis.
We have good supply arrangements in place. How do we know NCRC won’t jeopardize our agreements?
NCRC does not enter your organization with the philosophy of changing suppliers to those with the lowest cost. From our experience we have found that when suppliers are faced with a competitive position they most often reduce their costs either to keep their existing clients or to gain more business as your business grows.
How does NCRC understand our business and our detailed concerns and requirements?
At the start of the process, NCRC has only an initial understanding of your business and expenses. As professionals, we will learn your business and your supply arrangements as we go through the initial discovery process. This process is critical to expense cost reduction.
How does NCRC implement the new supply arrangements?
We manage the implementation phase of the project so that all changes are put in place quickly, efficiently and sustainably.
How can my organization afford such services?
All NCRC fees are contingent on identifying savings for you. All NCRC payments are from client savings. As we save you money, we get paid. If we do not find savings, we do not get paid.
Why is NCRC willing to take this “guaranteed” savings approach?
NCRC is confident in its ability to find savings. For over a decade the NCRC principals have consistently cut costs ranging from 3% to 54%. Every assignment is different and based on categories that the client selects. Our contingency fee is designed to be a win-win situation and put our clients at ease.
Can we accomplish similar savings with our own staff?
Most experts agree that in-house personnel have additional responsibilities, are focused on other tasks, lack the expertise of suppliers and current market costs, do not have the process and do not have significant supplier contacts required to achieve maximum business cost reduction.
What about our time commitment to support the NCRC efforts? Can we afford the time?
NCRC operates as an extension of your staff providing a fresh outlook at expenses while avoiding disruption of daily business management. You will spend only 8-12 hours per year on this initiative.
What about existing contracts? We just signed contracts so you can’t save us money, right?
NCRC can find savings regardless of contract status. Some of our best results have come for clients who just renegotiated their contracts.
Why should we use NCRC vs. doing this ourselves? Or an outside organization such as NCRC vs. doing it ourselves?
As independent third party professionals with extensive experience in negotiations it is NCRC asking for cost reduction, cost management improvement. We (NCRC) have the negotiating experience vs. you the client. This maintains your ongoing relationship with your service providers respectfully intact.
“For the last several months, I’ve been working with two gentlemen from National Cost Reduction Company, Leonard Levey and Joe Szuba, to determine whether there were places we could save money on goods and services purchased by the school. Leonard and Joe did a thorough evaluation of our vendors, contractors, utilities, etc. to determine if there were places we could save money. Based on their findings, they renegotiated rates with some of our vendors and, in some cases, found less expensive suppliers. It took very little effort on my part, and we are projecting to save $12,000 to $13,000 this year.”
— Kathy Lunsky