Purchasing & Supply Chain Management

Introduction2

Thesis Statement2

Discussion2

Significance of Purchasing and Supply Management2

Purchasing2

Supply Chain3

Selecting a Qualified Supplier3

Strategies for Negotiating Prices5

Revisit Suppliers Agreements6

Renegotiate the Terms6

Evaluate and Respond6

Rationalize the Supply Chain7

Optimistic Edge7

Organize the Procedures7

Creating a Project Supply, Service and Material Budget7

Employees8

Customers8

Share holders8

Pharmaceuticals8

Suppliers or vendors8

Detailed Requirements9

Benefits and Costs of Outsourcing and the Growth Pattern9

Saving the Costs10

Acquiring Skilled Expertise10

Aiming at Core Competencies10

Risk Management10

Increase the Efficiency11

Staff Flexibility11

Lowering the Costs11

Reducing Overhead Costs11

Supply Chain Management by Market Leaders12

Conclusion13

References14

Introduction

For any business purchase and supply chain play a vital role in carrying out the planned strategies of the organization smoothly. Its management gives a proper method to buy corporate commodities. This includes internal goods, indirect goods, buying raw material required for manufacturing purpose, updating the in-house inventory. Purchasing is often termed as 'procurement' in the process of supply chain. 'Contracting' is also a part of this chain which provides with purchase of services. In today's world, the trend of purchasing and supply chain has been changed. New technology provides with greater viability of the execution of the process (Ivanov & Sokolov, 2001). I will try to explain the various aspect of supply management with the help of my experience as a team member at one of MAX Factor projects. It is a U.S. based cosmetic company and holds noticeable rapport in the market.

Thesis Statement

Purchasing and supply Chain Management aims to improve the overall functionality of the business.

Discussion

Significance of Purchasing and Supply Management

Purchasing

Purchasing or procurement has adopted a new way of e-procurement and e-sourcing means which also have maximum legal support from the governmental bodies. It allows the entities to preserve the ownership, automatically larger group of people receive the benefit. Most recently the role of procurement is all about offering suitable guidance and an infrastructure for the corporate sectors to perform their operations (Handfield et.al, 2010).

MAX Factor is developing proper professionals to handle purchasing who act like internal consultants to manage a central reporting pattern. It aims to find ways to create awareness about ideal working practices with complementary level of skills. Purchasing professionals have to keep the element of innovation in their mind.

Supply Chain

It is a strategic approach towards creating a plan for anticipating existing and futuristic needs by organizing supply base and making “Cross Functional Teams” CFTs. They have to understand that their role is directly proportional to the working of manufacturing department. In short, the role of supply management is about identifying, appraising, selecting, organizing and developing suppliers to understand the working of supply chain. It has to formulate competitive management in the market (Dominick, 2006).

Selecting a Qualified Supplier

Qualified Supplier has some specific skills to render the goods or services. Companies usually prepare a list of preferred suppliers to fulfill their needs. They also have an opportunity to try some new suppliers in order to meet their need in the best possible way. Every organization makes its criteria for selecting suppliers which also address the weight-age of its mere qualification. In the context of globalization, firm are greatly sensitive to select the right suppliers for the as to ...