BEWI Danmark A/S has consolidated its supplier agreements in House of Control. The result is improved insight into obligations, fewer unwanted tie-ins and a better foundation for strategic procurement across six Danish factories.
For Karsten Bech Pedersen, who works with procurement and supply chain at BEWI Danmark A/S, contract management is about more than archiving documents. It is about knowing what the business has committed to, when agreements expire, which conditions apply, and how procurement can be utilised more strategically.
"When I started at BEWI, I discovered that the agreements were scattered around. Some were in drawers, others in emails or held by individual people. In practice, it was a large 'black box'," he says.
With House of Control, BEWI has transitioned from scattered agreements and local routines to a single source of truth for supplier agreements. Read this article to discover how they achieved this, and the benefits that Pedersen and his team have gained.
BEWI is a leading European supplier of packaging and components in EPS, EPP and Honeycomb. As consumers, we recognise these products as, among other things, the white fish boxes in Flamingo ®/EPS.
The company has a circular business model where the group produces raw materials and finished products, while used materials are collected and recycled into new products. Flamingo ®/EPS is particularly well-suited for recycling, notably because the product consists mainly of air.
For BEWI Danmark A/S, procurement operations cover six factories in the country, in addition to collaboration with operations in Sweden and Finland. The buyers are located locally at the factories, while Pedersen is responsible for the professional and strategic aspects of the procurement work.
This involves, among other things, leveraging economies of scale within BEWI, negotiating major framework agreements, and ensuring that suppliers comply with the group’s requirements and Code of Conduct.
"My role is focused on how we work with procurement and how we leverage the economies of scale within BEWI. That is what I have been hired to contribute towards," says Pedersen.
In addition, supplier follow-up and due diligence form a key part of his responsibilities. Among other tools, BEWI uses BEWI Partner, a shared group system for supplier approval, questionnaires and other types of supplier verification.
Prior to the implementation of House of Control, there was no single centralised repository for supplier agreements. Agreements could be entered into by different individuals across the organisation – a factory manager, a maintenance employee, a member of the dispatch team or other local stakeholders – and subsequently archived in various ways.
This made it challenging to maintain an overview of which agreements existed, who was responsible for them, when they expired, and which terms actually applied.
"There were an incredible number of stakeholders involved in the agreements, and everyone had their own archiving systems. In such cases, you do not necessarily know when the agreements expire, or whether there are onerous clauses regarding annual price adjustments or commitment periods," says Pedersen.
The consequence was a lack of overview, but the repercussions could also be financial and operational.
"That is the type of agreement we want to avoid going forward," he says.
Pedersen was familiar with House of Control from a previous employer and knew what the system could deliver. When he identified the need for better contract management within BEWI, he therefore took the initiative to consolidate the supplier agreements in House of Control.
The first step was to import all agreements into the system and register them with the correct details: expiry dates, notice periods, contract content, price adjustment clauses and other key terms.
"Initially, it was about getting all the agreements together in one place and ensuring they were registered correctly," says Pedersen.
Today, BEWI Danmark A/S has registered numerous agreements in House of Control. This work has provided the organisation with a shared contractual foundation and a far clearer structure.
To ensure high data quality, BEWI has chosen to centralise the registration process. In Denmark, there is one administrator for procurement and one for sales who input the agreements. A similar structure has been established in Sweden.
"If everyone inputs agreements independently, it can become difficult to find them again. Some might call it a truck, others a forklift, others stackers. Therefore, we have chosen to have dedicated administrators to ensure that items are registered consistently," Pedersen explains.
The most important benefit for BEWI is not primarily tied to a specific cost saving. The greatest value lies in the control.
"What we have achieved is complete insight into the obligations we have towards our suppliers. That is where the greatest benefit lies," says Pedersen.
With House of Control, BEWI can see which agreements exist, which suppliers they are linked to, which factories they apply to, and when they require follow-up.
This provides an entirely different level of reassurance in daily operations. Previously, critical deadlines could rest with individuals or be hidden in local archives. Now, the responsible individuals are alerted before agreements expire or must be terminated.
"The alerts are the most important feature for me. You cannot remember multiple agreements and when they expire. House of Control ensures that we are notified well in advance, so we do not have to expend mental capacity on remembering all the deadlines ourselves."
Pedersen also highlights a practical feature that saves time when registering supplier information.
"If you have a CVR number, you can look up all address details directly. That is really excellent," he says.
Once all agreements are consolidated, BEWI can utilise the information more strategically.
Among other things, Pedersen uses House of Control to identify agreements within the same category across factories. This makes it easier to see where the business has multiple local agreements that can eventually be consolidated into larger, shared agreements. An example of this is service agreements for forklift trucks.
"Once we have the overview, we can see how many different agreements we have at the various locations. In the long run, we can use this to consolidate the portfolio and approach the market with a unified agreement for multiple production units," he says.
This also has implications for renegotiations and the preparations for them. The goal is to synchronise the agreement portfolio over time, so that expiry dates and notice periods better support strategic procurement processes.
"Once we have uploaded all the agreements, the next step is to synchronise the expirations and avoid agreements that tie us down for an unnecessarily long time," says Pedersen.
For BEWI, this is about building stronger negotiating positions.
"If an agreement works well, it can be extended. Then, at some point, we can aggregate the entire portfolio of service maintenance and put it out to tender in the market," he says.
A key reason why House of Control works well at BEWI is that the system is easy to use.
"It is highly intuitive. You can get started quickly, and it is easy to understand how the system works," says Pedersen.
Another strength he highlights is the ability to customise dashboards. For instance, factory managers can set up views that only display agreements relevant to their specific factory.
"The factory manager in Hobro is primarily interested in what applies to his factory. He can then configure his dashboard to get exactly the overview he needs."
At the same time, agreements can be tagged so that the organisation can clearly see whether an agreement applies to a single factory, multiple units or the entirety of BEWI Danmark. This provides both local ownership and centralised control.
BEWI has had a limited need for support in day-to-day operations, precisely because the system is easy to use. Nevertheless, it is important to know that help is available when required.
"The less contact we have, the better it actually is. It means the system works. But when we do need to clarify something, we want quick answers. We get that from House of Control," says Pedersen.
He describes the collaboration as straightforward and efficient.
"Customer Success Manager Simon Søgaard-Pedersen at House of Control is there when we need him."
For Pedersen, the value of House of Control is clear: the system provides an overview, structure and control over supplier agreements, without making the workday more complicated. This is also the message he wants to convey to other procurement managers.
"If you want an easy way to keep track of supplier agreements that can also be customised for your business, you should look at House of Control."
For BEWI Packaging Danmark, House of Control has become a tool for more than just contract management. It provides insight into obligations, reduces the risk of unwanted tie-ins and establishes a better foundation for leveraging economies of scale in an international industrial enterprise.