If you don t want to calculate this manually, a spreadsheet is attached that does the math for you if you know how many bales of rags are currently being used. The shop towel vendor is very flexible. Adjust the quantity delivered until you reach a number that leaves you with just a few on hand at the time of your regular delivery. This will maximize your savings since you won t be paying for towels you didn t use. You may also want to eliminate paper towel usage.
Close approximation is one box of towels equals one bale of rags.
Convert boxes of paper towels to bales of rags. Use number of bales in the equation above to determine number of shop towels required. How to Determine Procurement Savings Determine annual requirement for baled rags and or paper towels, then multiply by unit cost. Determine number of shop towels required to match usage of baled rags and paper towels per equation above. Multiply number of shop towels required by contract unit price.