A sourcing lead at a fast-growing snack company was tracking chocolate commodity prices daily. Futures were moving. Her supplier kept raising prices, citing “market conditions.” So she did something the team hadn’t done in a while: she called three other suppliers for quotes.
The incumbent was charging roughly 30% above what the market was offering for the same grade of chocolate. When she asked for an explanation, the supplier didn’t have one.
This happens more than anyone admits. Pricing data lives in email threads. Nobody has a centralized view. Quotes from 18 months ago sit in somebody’s inbox, unstructured, unsearchable. The team knows they should rebid more often — they just don’t have the bandwidth, because the process is so manual.
So they accept the increase. They tell themselves they’ll rebid next quarter. Next quarter comes and goes. The supplier knows this. A few percentage points of margin, invisible on the P&L, compounding every quarter.
It’s not bad negotiation. It’s the absence of infrastructure. When running an RFP means 50 questions per supplier, 12–15 documents to collect, and weeks of email back-and-forth, teams rationally avoid doing it. One team told me they run 50% fewer competitive bids than they know they should.
Raw materials are 40–50% of revenue for most CPG companies. If you’re spending $80M a year on ingredients and you’re overpaying by even 3–5% because you haven’t rebid in two years, that’s $2.4M–$4M walking out the door annually. Not from a bad deal. From no deal at all.
“The most expensive RFP is the one you didn’t run. And the reason you didn’t run it is because the process makes it irrational to try.”
The teams closing this gap aren’t hiring more procurement staff. They’re structuring the data they already have. When supplier quotes, specs, and pricing get extracted from email automatically, running a bid goes from a multi-week project to a same-day task. One customer went from bidding 40% of their raw spend to over 75%, and found more than $400K in savings across 11 ingredients.
You don’t always need to switch suppliers. You just need to know what the market actually looks like. Often the act of running the bid is enough — your existing supplier magically “finds” a better price when they know you’re looking.
