Product benchmark is a method for cutting the costs of products of limited technical complexity, with the focus on the specifications and the production process. A tried-and-tested product benchmark process can be broken down into four steps:
Identification of comparable products: The initial step is the identification and procurement of comparable products from competitors. To identify competitors 'products requires interviewing sales, development, customers, and suppliers. The competitors' catalogs are also evaluated. The outcome is a list of relevant competing products.
Evaluation of competing products: The individual products are compared, with the help of development and production. Each product is rated according to functionality, technology, usability, and compliance with specifications and dimensions. Products that fail to meet internal requirements are eliminated at this stage .
Invitations for bids for existing products and alternatives: Suppliers are invited to tender offers for existing products and appropriate alternatives. As part of the tender process, suppliers are advised of possible design solutions that could be adopted from competitors. Especially for alternative products, it is crucial that the process includes new suppliers along with existing ones.
Analysis of results: The final step is to analyze the results and identify potential cost savings. Individual alternatives need to be prioritized on the basis of feasibility and potential. For high-priority offers, the next steps of implementation should also be identified.
Product benchmark allows various alternatives available on the market to be compared quickly and with relatively little effort. The involvement of procurement, development, sales, and suppliers is crucial, but should be strictly limited time-wise. The results can normally be implemented rapidly, insofar as it has already been determined that comparable products are available from suppliers. Product benchmark should be carried out right at the start of developing a new product, so that any necessary design changes can still be incorporated in time.