Harnessing the benefits of supplier consolidation – 5 minutes with Veronique Lemaire and Juliana Staight

To start, tell us a bit about yourself and your current role.

VL: My name is Veronique Lemaire, I'm originally from Belgium but have been based in Spain for the past 20 years. I’ve worked at TMF Group for about 6 years, currently as Head of HRP Client Solution in the payroll practice management team. I oversee new service offerings, and I manage our consultancy services and our global HR admin work.

JS: I'm Juliana Staight, I’m based in London, UK and I’ve been a Client Director at TMF Group for almost five years. I manage around seven of our top clients, acting as their main strategic and commercial point of contact. My job is to identify opportunities where we can support our clients through key lifecycle changes – whether they’re growing, retracting or diversifying, I bring in the right teams and specialists to guide them through the transition.

How did you get into what you do?

VL: Before joining TMF Group, I spent around 15 years working with a number of organisations in the HR and payroll outsourcing space, including ADP and ACS/Xerox Services, now known as Conduent. My focus areas included implementation, recurring services management, corporate transformation and HR and payroll strategy.

JS: I started my career in corporate tax at PWC, and then I moved into the outsourcing space, heavily focused on startups. After that, I worked in-house at Pentaho (Hitachi) and then went back into outsourcing at TMF Group. I’m quite lucky that I’ve seen all the different angles; my technical background helps me identify challenges and deliver the right solutions – consolidation comes up a lot in my line of work.

Vendor consolidation is indeed a growing business trend – but many companies still rely on multiple service providers. Why do you think that is?

VL: In some cases, legacy systems have been in place for a long time and haven’t been reviewed, or companies may not have prioritised consolidation during an acquisition. Sometimes clients rely on a patchwork of solutions that no longer meets their needs. Smaller entities might not consider alternative solutions, and some entities may implement an alternative solution, but not necessarily with the same provider. Improvements aren’t always applied evenly across the client´s footprint due to the associated cost.

JS: Organisations looking for low-touch solutions will sometimes opt for multiple providers rather than taking a unified approach. Local teams often have established relationships with local vendors, and they tend to like that sense of familiarity. Some companies prefer having a diversity of providers to maintain business continuity; other companies simply aren’t aware that they can use the same vendor across multiple locations.

At which point in their journey do clients typically think about consolidating service providers?

VL: Companies often only see the true cost of juggling multiple vendors when a new person comes in and starts tracking vendor management expenses. Using multiple vendors can also reduce a client's influence with each provider; clients who do not feel adequately supported may consider consolidating to enhance their buying power and service quality.

JS: In my experience, a change in personnel is a big reason to look at vendor changes – this often leads to transformation projects in areas like payroll, HR and benefits. Implementing new technology – like an HR management platform – is another opportunity to streamline vendors, achieve consistency and enhance reporting across multiple entities, meaning that payroll management in one region can mirror payroll management in others. Organisations aiming to manage budgets more effectively and reduce P&L expenses may also find consolidation beneficial, while regulatory changes or geopolitics can also spark transformation initiatives.

That’s interesting – have you encountered a situation where a client reported that decentralised services led to a compliance issue?

VL: Yes, that’s something we hear often – limited visibility into local processes is a big challenge, and the knowledge required to execute those processes is often lacking. For example, if someone retires, tasks managed at the local level may be left unfinished, particularly if HQ is unaware of the correct processes. And of course, non-compliance can lead to fines and reputational damage.

JS: Compliance issues are certainly common – I recently heard of situation where a local vendor failed to pay social security contributions despite receiving payments from the client, who was unaware of the issue due to language barriers and lack of direct reporting. In another case, a payroll provider closed their business with two weeks’ notice; the client was unprepared, and we stepped in quickly to assist. Some vendors, especially those operating as small, local firms, might close or retire on short notice, leaving clients exposed to risk.

So, in your view, what are the key benefits of consolidating service providers?

VL: Aside from risk reduction and streamlined processes, consolidation makes compliance costs more measurable for clients. For example, outsourcing payroll to a single partner offers predictable costs compared to in-house management, where payroll expertise may be limited, increasing both compliance risks and costs. Plus, combining payroll and HR admin services makes it easier to generate relevant data, eliminating the hassle of reconciling information from multiple vendors. For HR, payroll and finance professionals who feel that pain daily, it’s a huge benefit.

JS: From my perspective, having one main vendor creates familiarity and a more efficient governance structure. There’s an intangible benefit there that I think is sometimes difficult to put a dollar value on; knowing how to engage with your vendor and having a familiarity around contracting and how the pricing works takes away a huge amount of cost to clients because they don’t have to reinvent the wheel every single time. It also improves the employee experience – for example, when payroll is being correctly calculated, delivered and reported, it reduces the HR time spent on queries and troubleshooting. Plus, integrating payroll with other services like accounting streamlines operations and makes it so much easier on finance teams.

Would you say that consolidation helps organisations standardise and scale faster?

VL: Consolidation and standardisation are definitely closely linked – choosing one global partner can help ensure consistent processes and systems worldwide. When you carry out your due diligence, make sure your chosen provider delivers both – check for unified platforms, standard procedures and relevant certifications.

JS: KPIs and SLAs are certainly easier to manage with one vendor, ensuring a consistent client experience across countries. We very rarely have different SLAs in different countries – we believe that every country should be given the same priority, whether it’s a 3000-person payroll or a 200-person payroll. And scaling is much easier when vendors are consolidated. A&T consolidations can take longer as financial periods must be closed, taxes filed and audits completed. ERP systems can add potential benefits such as consolidation, reconciliation and harmonisation. This type of consolidation supports larger data volumes and provides better insight, for example, tax liability monitoring and invoicing backlogs, as the business scales. One of our clients was able to improve the invoice to collection day statistics by 26 plus days after a year of consolidating.

That’s impressive – can you tell us a bit more about the efficiency gains?

VL: Consolidation offers a defined governance structure, simplifies points of contact and removes language barriers. Streamlined processes help companies improve communication and speed up decision-making. Consolidation also provides a predefined process for handling both standard operations and unexpected disruptions.

JS: It provides a clear escalation process too; pricing models are established early on, allowing for easier integration of new locations and simplifying negotiations for out-of-scope services. This can save time on the client side. Issues at specific locations can be addressed more efficiently due to increased visibility. In contrast, working with multiple vendors can be more challenging, as priorities may differ by region. Other efficiencies include improved access to data and faster reporting. On the GEM side, we helped a client implement a more seamless annual legal compliance process using our Kraios platform, resulting in a 45% reduction in their legal spend.

What advice would you give to companies considering consolidation?

VL: Firstly, you need to crystallise your reasons for consolidation – whether it’s cost savings, compliance concerns or policy requirements. When you assess vendors, make sure you involve your operational teams – those who will directly interact with the new vendor. This step is often overlooked, yet, in my experience, it significantly impacts the speed and success of adoption. You also need to ensure that your chosen vendor can support your strategic ambitions in the long term – are they flexible enough to adapt to your changing business needs? Do they have the capabilities to support your current and future objectives? Make sure you choose a partner you can grow with.

JS: A vendor consolidation exercise is a great way to bring together multiple strategic objectives. Consider the value that can be unlocked with process efficiency, data centralisation, better spend management and scale optimisation, as well as the overall improvements in employee and functional team experience. Consolidation will involve a deep-dive assessment of legacy systems which will uncover some unknowns, but the longer-term benefits of cost reduction, harmonisation and consistent overview will allow you to spend more time on business growth and further improvements.

Having one main vendor creates familiarity and a more efficient governance structure – there’s an intangible benefit there that I think is sometimes difficult to put a dollar value on.

Choosing the right consolidation partner

Thinking of simplifying your vendor network?

Read this article to learn more about how to choose the right consolidation partner for sustainable business growth.