How ERA Cut 24.7% for Direct Heating Group

The Client

‘Make the home with Direct Heating Group.’

Whether you’re a homeowner or a trade professional, Direct Heating Group’s multi-channel approach, commitment to quality and honesty, and exclusive brands make them the UK’s premier choice for all heating needs.

Direct Heating are enjoying a period of growth, particularly through strong online sales – but knew there were efficiencies to be found within their business.

The Opportunity

The Opportunity Assessment highlighted 6 categories where we were confident that we had the knowledge, experience and expertise to deliver cost savings, process improvements and efficiencies for Direct Heating Group. Some of these were under contract so will be reviewed at a later date, and priority was given to 3 areas with immediate potential:

Couriers

Direct Heating Group were coming to peak period and were nervous about changing supplier, so Charles Reid, one of ERA Group’s Lead Logistics Specialists, negotiated and secured a significant rate reduction with the incumbent, with potential for a full market review at a quieter time for the client. The solution was fully implemented within 3 weeks of engagement.

Pallets

Pallet transport is typically regarded as a low margin business. However, with ERA’s leverage with the pallet networks, Charles was able to leverage a great result for Direct Heating Group. Consolidating all of the group’s sites with one national pallet network whilst delivering an 18% saving and improved service levels.

Teknologia

Historically Direct Heating Group had received a great service from their MSP provider, unfortunately though, through a series of acquisitions, they were now contracted to a much different, larger, and unresponsive supplier. John Addis, ERA Group’s technology lead, was engaged and quickly moved licences to a different provider, securing a better service, with a responsive account manager, delivering a saving of 22%.

Summary of savings

Kevin summarised “It is always a pleasure to introduce ERA Group’s specialists to a client, they consistently deliver value. Not only through great cost savings, but also through the Service, quality and process improvements that they identify and support implementation for”

Courier: 57.42% (£64k on £112k spend)

Pallets: 18% (£96k on £536k spend)

Technology: 22% (on Microsoft licences)

Total Savings: 24.7% (£160k on £648,000)

Couriers

Direct Heating Group were coming to peak period and were nervous about changing supplier, so Charles Reid, one of ERA Group’s Lead Logistics Specialists, negotiated and secured a significant rate reduction with the incumbent, with potential for a full market review at a quieter time for the client. Within 3 weeks of engagement it was fully implemented, meaning no change to service and a reduced cost ongoing.

Projects are also underway to integrate the client and courier IT systems to automate data transfer and reduce non-value added effort.

Pallets

Pallet transport is typically regarded as a low margin business. However, with ERA’s leverage with the pallet networks, Charles was able to leverage a great result for Direct Heating Group. Consolidating all of the group’s sites with one national pallet network whilst delivering an 18% saving and improved service levels.

Teknologia

Historically Direct Heating Group had received a great service from their MSP provider, unfortunately though, through a series of acquisitions, they were now contracted to a much different, larger, and unresponsive supplier. John Addis, ERA Group’s technology lead, was engaged and quickly moved licences to a different provider, securing a better service, with a responsive account manager, delivering a saving of 22%.

Summary of savings

Kevin summarised “It is always a pleasure to introduce ERA Group’s specialists to a client, they consistently deliver value. Not only through great cost savings, but also through the Service, quality and process improvements that they identify and support implementation for”

Courier: 57.42% (£64k on £112k spend)

Pallets: 18% (£96k on £536k spend)

Technology: 22% (on Microsoft licences)

Total Savings: 24.7% (£160k on £648,000)