Rewiring Services Procurement to Save $12M and Scale to $90M

A decentralized model, rewired into one program

One of the largest food and drug retailers in the United States needed to rewire its services procurement model. Operating across 35 states under 20 leading brands, this major player generates $79.2 billion in annual revenue and has 270,000+ employees.

In 2021, Vertage began an integrated Managed Service Provider program, spanning Independent Contractor compliance, Statement of Work and profile management for administrative, engineering, professional, IT and industrial roles.

By Q4 2023, the partnership had expanded further, adding services procurement management, doubling the program's size as focus shifted to strategic SOW providers.

Without visibility, risk accumulates

Decentralized procurement

A decentralized approach to procuring services built up inefficiencies, higher costs and compliance risk. None of it visible from one place.

No shared standards

Rate visibility and worker classification stayed invisible across the business. Cost and compliance exposure accumulated quietly.

Scale without control

The retailer needed to streamline vendor relationships, optimize costs and ensure workers were classified correctly, across professional services and SOW engagements.

Rebuilt around assessment, classification and control

Assessment and classification

Vertage ran an extensive organizational assessment to map every category of external services spend and understand supplier capability, by category and location. A new classification framework aligned workers with engagement type and confirmed SOW, cutting compliance risk at the source.

Procurement and supplier roles

Services procurement processes were standardized organization-wide, with SOW supplier roles and capabilities clearly defined by service category.

Compliance and rate cards

New compliance protocols reduced labor classification risk, including for SOW engagements. Rate card methodologies brought costs under control and sharpened vendor competition.

Analytics and reporting

Vertage now operates as an extension of the retailer's procurement team, giving managers and buyers real-time, data-led insight. This guidance turns people-based SOWs into transformational value, not just transactions.

One governed program. Savings, spend and placements, connected

Cost savings that keep growing

$12M-plus in cost savings, delivered through supplier negotiations, rebates and workforce optimization, with further reductions still targeted.

New spend, scaling fast

$90 million in new SOW spend. Projected annual spend totals $375 million to $400 million.

Workers and agreements, onboarded at scale

2,200+ new SOW workers integrated. Nearly 500 new SOW agreements created.

A supplier base for the long run

75+ new providers added in one year alone, strengthening capability and coverage across service categories.

Risk brought under control

Proper worker classification, reduced misclassification risk, and compliance monitoring, built directly into contracts, not bolted on after.

Growth since MSP launch

Since the MSP program began, the retailer has grown to roughly 3,000 SOW engagements and 1,400+ contingent placements, one governed program tracking savings, spend and placements in a single place.