As America’s avaition industry comes under increasing pressure to reduce operating costs America West Airlines, the nation’s eighth largest air carrier, today annouced it has licensed the Internet-based Custom Procurement Management System (CPMS) from MaterialNet, the Lake Success, N.Y.-based provider of eSourcing solutions.
The CPMS is an ASP-based suite of eSourcing tools that include auction, electronic request for information, order management and award notification, document management and analytic capabilities.
America West says it will be using the eSourcing platform to conduct reverse auctions with its suppliers. MaterialNet’s says the CPMS will allow the airline to cut costs without affecting quality by enabling it to control spending with a group of key suppliers.
Initially, the airline is using CPMS to buy products and services such as hotel rooms, crew transportation services, in-flight products, cleaning services, computers and equipment, and has plans to expand the its use to make purchases in other areas.
“We are convinced that MaterialNet’s CPMS is a great tool to procure the materials, goods and services vital to our business,” says Michael Inman, Director of General Purchasing at America West Airlines.
“MaterialNet’s features allowed us to easily generate savings and exceed our ROI projections. Based on our initial success, we are eager to implement CPMS across several key expense areas,” he continues.
“Efficient purchasing practices that streamline processes and cut costs are critical to company growth and profitability,” says Joe Pecoraro, COO of MaterialNet, who adds that the firm is pleased that the American West has recognized the value that CPMS brings to their organization.
The airline says it has already has run successful trials with a limited number of its suppliers for reverse auctions and is currently working with MaterialNet to introduce the process with its full supplier base.
As America West engages more suppliers into these auction, it says it is expecting to see additional savings and streamlining of the procurement process.