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How Will Sprint’s Partnership with Scopeworker Help Reduce Costs?

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Sprint partners with Scopeworker

Sprint (S), the fourth-largest wireless carrier, has collaborated with Scopeworker, a company that specializes in supply chain management.

The digital transformation of its supply chain operations should help Sprint to effectively compete with its rivals as it prepares for the launch of 5G (fifth-generation) services in the first half of 2019.

Digital transformation to reduce costs

Sprint undertook several trials before agreeing to leverage Scopeworker’s namesake software, the Industry 4.0 Digitized Supply Chain Vendor Management System (or DSC VMS), to digitize its multibillion-dollar supply chain. The DSC VMS platform automates engagement between buyers, suppliers, and workers through web interactions or apps for end-to-end supply chain management.

The company recorded double-digit savings for its procurement department in the trials. Scopeworker is likely to create programs to automate cost, time, and quality efficiencies across the board to improve Sprint’s network coverage, reliability, and speed.

Sprint aims for cost savings

Sprint has been making serious efforts to cut its costs to revive its profits in the wireless space, which is dominated by AT&T (T) and Verizon (VZ). In fiscal 2017, Sprint realized nearly $1.1 billion in net cost reductions by lowering its service costs and selling, general, and administrative expenses. The company has already cut ~$6.0 billion in costs over the last four years. 

Sprint’s cost-saving measures have been impressive and have significantly contributed to its turnaround in customer additions in the past four quarters. Sprint’s ongoing initiatives have been reflected in its improving net income.

Sprint delivered profits of $1.81 per share in fiscal 2017 after incurring losses for the previous three years. The company also reported its highest adjusted EBITDA in the last 11 years.

T-Mobile and Sprint merger would create synergies

Sprint and T-Mobile (TMUS), the third-largest wireless service provider in the United States, announced a merger deal on April 29. The merged entity is expected to post adjusted EBITDA of $22.0 billion–$23.0 billion in fiscal 2018.

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