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Rent-A-Center Saves Millions With Cloud-Based Procurement Process

Demand for cloud-based solutions continues to intensify as more retailers recognize the cost and performance benefits of cloud computing. In fact, cloud software revenues are expected to reach $67.3 billion by 2016, from $22.9 billion in 2011, according to IDC Insights.

Rent-A-Center (RAC) partnered with IBM Smarter Commerce and Coupa Software, an e-procurement software company, to move procurement processes to the cloud. The goal was to reduce sourcing costs and cycle times, and increase accounts payable productivity.

Through the collaboration, RAC successfully transformed several procurement procedures, streamlined spending and “achieved millions in savings by optimizing and centralizing its purchasing process in the cloud,” according to an IBM press release.

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Among the notable successes gained from the implementation, RAC also:

  • increased spend visibility;
  • automated sourcing for 90 separate spend categories;
  • consolidated and reduced the supply base by 10%;
  • decreased the number of invoices by 5%; and
  • saved an average of 10% across all sourced categories.

“The IBM and Coupa integration has been fundamental in driving our positive results as we revamped our procurement efforts,” Mike Wilding, SVP of Accounting for RAC, said in an interview with Retail TouchPoints. “A major part of our transformation focused on increasing productivity by automating manual processes like invoicing and contracts. We are very pleased with our savings to date, and we are on track to achieve our savings targets over the next few years.”  

RAC targeted a “fairly complex roll-out schedule for our 4,000-plus locations,” said Wilding. Once the project got underway, he added, the implementations went so smoothly that, if necessary, the chain-wide roll-out period could have been shortened.

Previously RAC had a de-centralized and manual purchasing process with low employee adoption, according to the IBM press release. In addition, the onboarding of suppliers was time-consuming and complicated. RAC was unable to consolidate purchasing efficiently to influence pricing or optimize the contract, invoicing and supplier management processes.

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