Total Cost on Purchasing

Post on 10-Apr-2015

740 views 0 download

description

it is talking about how to effectively manage the purchasing material cost

Transcript of Total Cost on Purchasing

Bid-based renegotiationsReverse AuctionsPrice/performance benchmarking Model “should-costs”

Volume redistributionGlobal ProcurementMake / Buy

Optimize physical material flowIntegrate logisticsReduce InventoryTaxation / Duties / CustomsTransportPackaging

Lease / BuyTooling / Prototypes Maintenance / SparesWarranty / LifeNon recurring

E-ProcurementTrading exchangesRationalize part count and suppliers ERP/ P-Card

Contract consolidationPartnershipsSupplier development Long-term agreements

Eliminate need Policy / Budget changesExtend Life

Cooperative purchasing/ alliancesCommon specification Leverage

Lower cost specification Optimal service levelDesign for manufacturingDesign for assembly Value analysisValue Engineering

Redu

ceCo

nsum

ption

Cons

olida

teSp

end

Impr

ove

Spec

ificat

ion

CostCash

QualityService

Innovation

Total cost management

Purc

hase

Dem

and

Man

agem

ent

Supply Base Managem

ent

Restructure

Relationships

Increase

Competition

Restructure

Supply Base

Optimize TotalSupply Chain Costs

Reduce Total Life cycle/Ownership Costs

Reduce/EliminateTransactions

Total Acquisition Cost ModelCross-Functional collaboration is essential for reducing Total Acquisition Costs

What do we look at?What do we look at?

Liu
Text Box