Procurement leaders are being asked to deliver more value with fewer resources, while supplier complexity keeps rising. New compliance requirements, tighter capacity, and higher volatility have turned supplier management into a daily balancing act across cost, quality, and risk.
That is exactly why supplier collaboration has surged in priority for procurement leaders. Gartner reports that in the past 24 months, supplier collaboration “skyrocketed in priority for 88% of procurement leaders.” (Gartner)
But prioritizing SRM is one thing. Funding it is another. So let’s get concrete about where SRM software creates savings, how to quantify it, and what this looks like in the real world.
Savings bucket 1: Hard savings from better spend control (especially tail spend)
In manufacturing, food and beverage, energy, utilities, chemicals etc, procurement teams often have a mature strategic sourcing motion for core categories. The value leak usually hides elsewhere: fragmented supplier data, unmanaged renewals, and tail spend that slips through without preferred suppliers, negotiated pricing, or consistent buying channels.
Kodiak Hub’s SRM ROI Calculator uses a simple but practical assumption: 20% of total procurement spend is tail spend, and customers of Kodiak Hub often report savings of 3% to 5% on that tail spend after adopting SRM software.
That math is intentionally straightforward because it matches what procurement teams can defend internally:
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More spend routed to preferred suppliers
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Fewer “surprise” buys from unqualified vendors
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Less maverick purchasing driven by missing supplier info
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Faster decisions because supplier performance and compliance data is in one place
ROI Calculator formula (tail spend savings):
Total spend × 0.20 × (0.03 to 0.05) = savings on tail spend
Savings bucket 2: Time savings that turn into capacity (or headcount avoidance)
Most procurement and quality teams do not lack initiatives. They lack time.
SRM software pays back quickly when it removes administrative drag from supplier onboarding, assessments, and audits. Supplier onboarding can take 10 to 20 hours of manual effort per supplier, and Kodiak Hub is estimated to automate around 80% of that manual work.
An average procurement salary is estimated to be €70,000 per year and 1,920 working hours.
ROI Formula (onboarding time savings):
Number of Onboardings × 12 × (10 to 20 hours) × 80% × (70 000 ÷ 1920) = annual savings
In regulated industries (pharma, chemicals, food and beverage), this is not just efficiency. It is throughput. If onboarding and qualification are slow, the business loses options when capacity tightens or risk hits.
Savings bucket 3: Audit cost reduction (and fewer expensive surprises)
Supplier audits are necessary in most of our target industries. They are also expensive.
Kodiak Hub's customers have reported that a typical supplier audit costs between €2500 to €20 000 per audit, and it has been showed that SRM software can help save around 20% on audit costs.
ROI Formula (audit savings):
Audits × (2500 to 20 000) × 20% = supplier audit savings
Even if the audit count stays the same, SRM reduces cost through better preparation, fewer repeat issues, faster follow-ups, and less time chasing evidence.
What savings could look like: Elfa’s results with Kodiak Hub
Elfa is a great example of SRM impact because the savings did not come from one “big negotiation.” It came from shifting from reactive firefighting to structured, preventive supplier management.
In Elfa’s case study, they report:
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€48 000 in cost savings by reducing yearly claims by 50%
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Claims falling from 322 to 134, with Elfa estimating 160 avoided claims attributable to Kodiak Hub, valued at 3 000 SEK each (€48 000)
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Supplier quality improving from 82% to 98.1%
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Supplier qualification accelerated 3x, from 24 months to 8 months
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Supplier base reduction from 432 to 122, strengthening negotiation leverage and focus
For quality and supplier management professionals, the claim reduction story is especially important. Claims are not just a procurement KPI. They create real operational costs: rework, freight, downtime, inspections, customer risk, and engineering distraction. Read the full case study here.
The takeaway: SRM savings are not one lever. They are a system.
SRM software creates savings because it gives procurement, supply chain, sourcing, and quality teams a shared operating system for suppliers:
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One source of truth for supplier data and documentation
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Faster onboarding and qualification
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Consistent assessments, scorecards, and audit trails
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Structured corrective actions and supplier development
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Clear visibility into where value is created (and where it leaks)
If you want a fast way to put numbers behind your SRM business case, start with the Kodiak Hub SRM ROI Calculator assumptions (tail spend savings, onboarding time savings, audit savings). Then layer in the higher-impact outcomes you care about most: fewer claims, fewer disruptions, and better supplier performance, like Elfa achieved.
