LKQ Corporation is North America’s largest supplier of used auto parts – a Fortune 500 company with extensive operations throughout North America and Europe. In 2013, LKQ Corporation reported more than US$5 billion in revenue.
And yet, its regional centres, specifically the Midwestern United States, were using cumbersome, inefficient email-based purchasing processes.
Since adopting Procurify, LKQ Corporation’s midwest region has streamlined its auto parts purchasing and other procurement processes and promoted a price-conscious mindset.
Read on for more on how Procurify is helping LKQ Corporation…
Can you describe what LKQ Corp. does? And, can you give us a sense of the history of the company?
The LKQ Corporation is a global automotive recycler and after-market auto parts supplier to all types of industries, but mostly to insurance organizations and body shops. The LKQ Corporation was actually founded in the late 1990s, and grew from three small auto parts facilities – one in Ohio, one in Southern Wisconsin and one in Florida.
So, three automotive recycling yards quickly became a nationwide brand, a north America-wide brand and, finally, an international brand after expanded into the UK and Europe. We recently bought Euro Car Parts, which was an after-market automotive replacement parts – brake pads and things of that nature – supplier. It was the largest company of its kind in the UK and Europe. Lastly, we have expanded into Australia and Taiwan, so we are truly a global automotive recycling company.
Can you describe the size and scope of your purchasing and procurement processes? How much are you ordering?
The structure is ever-changing, due to the influence of Procurify. The process we used in the past was just email-based. So, if you needed to order toner for your printer or pens or paper clips or even rolling staircases for the warehouse, we set up a Midwest Region purchasing group and that group would get an email and research the best option for what you wanted. We would look out in the marketplace, for whatever the product, and order it. That system ensured our employees weren’t going out buying things on their own and then filling out expense reports. It also helped us standardize the products we were using – the group made sure every site was using, for example, the same pens.
But now, with Procurify, we have our entire “Midwest 1” district on board. There are a lot of people in this region that we support, so different departments do purchasing and it all funnels through our purchasing chain.
Because you deal in used auto parts, and handle so many pieces at any given time, are there any nuances or distinctive characteristics to purchasing management in your field?
We have a lot of proprietary things that we order through certain vendors. For instance, we buy a lot of things through Quill – toner, office supplies and some gloves, for instance – but our proprietary products have logos or seals that we are required to have. Whether it is a proprietary item or something that we could buy on Amazon, Procurify lets us put all of those things in one place. So, it doesn’t matter what a person needs on any specific order – if you’re Joe in Cleveland and you need something you can add anything to your order in one simple step.
How did Procurify help LKQ Corp?
Procurify has streamlined things immensely. One of the examples I like to use is that before adopting Procurify, we used to get an email telling us what to order. For example, an employee would need some tape.We would have to send emails back and forth of figure out what online casino kind of tape. So, there would be an email chain going back and forth and depending on how busy we were, it could have been a day or two before we finally got an answer and could order the tape. Procurify has obliterated that. Things are so streamlined now.
If you can use eBay or Amazon, you can use Procurify. It is so simple.
Also, in our business, we use a lot of gloves. So, you can’t just order a dozen blue gloves – we use many different types of blue gloves. But, with Procurify, users can go in and choose which kind of blue gloves they need, eliminating any miscommunication.
Now that some help has arrived what does that allow you to do? Does this open up potential capital cost savings down the road? Or, have savings been found in areas such as increased employee efficiency or a decrease in admin time?
All of the above. The emails stopped coming in. Our department is a mix – we do a lot of purchasing stuff, but we also do a lot of on-site support for IT stuff. So, our inbox is constantly packed with things that are coming. Now, we can differentiate easier between the kinds of messages coming in because we don’t get purchasing emails all day long. It all goes through Procurify – and represents a real decrease in admin time.
The response from our entire district has been phenomenal. Everyone has taken to Procurify and in 2015 the plan is to really broaden the horizon and implement Procurify in our entire Midwest region as a whole. We’ll definitely be telling folks in Michigan what this software has done for us.
Procurify has also made users more aware of pricing. Instead of just requesting a new box of gloves, the software has helped put a price to that box of gloves, which helps with budgeting. It makes people aware of pricing. That saves us money in the long run.
Is there any feature in particular about Procurify that most impressed you, or that you found most beneficial?
The “Need Help?” button. I created a user recently and, as a result, that person got an invite sent to him to set himself up in the system. We were placing an order for him and, for whatever reason, the order wasn’t showing up. So, I thought I did something wrong. I pressed the “Need Help?” button and someone answered me within minutes. He had an answer for me right away and within five minutes everything was back to normal.
At Procurify, providing an intuitive, beautiful user experience is something we take very seriously. Can you talk about Procurify’s design, and how that design impacts the usability of the software?
The user interface is very simple. For a typical requester you have three buttons on the top – dashboard, request and status. So, there isn’t much to choose from there, which is good. And, we have more than 600 items in our catalogue and we are adding more everyday. It is easy for users to navigate and use exactly what they want – status to check on what they ordered, their calendar or a simple snapshot on the dashboard.
From the procurement side, I see the budget overview and that really help me because I can set limits for certain departments and users judging on what that person typically spends.
How important is having remote access to Procurify for your company? We are very proud of our mobile offerings. Do you have people working off-site often? If so, is remote access a particular benefit?
Since Procurify is cloud-based and not installed on-premise, it is really nice to look at it from home. I was even showing my father in law the software recently – it is really nice to log in quickly, wherever I am, and use the software.
If you were the star of the next Procurify commercial and you had to deliver a final message on why LKQ Corp. uses Procurify – what would that message be?
Procurify – very simple to use and very easy to navigate. The key words are simple and clean. For a department that was trying to standardize processes and make things easier, Procurify was the way to go. We did look at other solutions, but Procurify was the one that took us where we needed to go.