Purchasing and Procurement Flashcards
What customers want ?
to be safe and confortable, the best product/service
- market level price
- short delivery time
- on time delivering
- better and still reliable delivering time
What’s reverse process ?
Customer => Retailer => Warehouse=> diagnostic : internal (Cie) ; external (supplier => 2nd diagnostic)
what is required to be JIT ?
- Reactivity throughout the supply chain (information flow the most important)
- Vision & monitoring
- Cost efficiency
RFI
RFQ
MOQ
Request for information
Request for quotation (Price, MOQ, LT) ask at least 3 suppliers
Minimum Order Quantity
Logistics definition
movement of material in the whole supply chaine
Supply chain definition
concepts and steps that allow the transformation of raw material into products and delivering it to the customer
Purchasing definition
executing a transaction between organizations and their suppliers to buy goods and services
Procurement definition
Refers to the acquisition of goods or services (including, order creation, receiving, payment)
5 “rights” of the global purchasing
right quality
in the right quantity
at the right time
for the right price
from the right source
OPO
PO
PR
open purchase order
purchase order
purchase request
Why purchase ?
- to consume
- to integrate
- to resell
How do we buy ? (PU)
1- identify & challenge the need
2- technical/functional specifications (check with stakeholders)
3- Sourcing (ask actual and additional supplier)
4- RFI and analysis
5- RFQ and suppliers selection
6- Negociations
(7- contract/order & 8- IS validation)
Purchasing challenges
- Profit (impact on operating margin and product quality)
- Safety (procurement risks)
- Service (reactivity ; identify and manage risks & opportunities to the purchasing act)
- Image
Purchasing missions
- Contribute to the improvement of the Cie’s results
- Contributors to the stability of the margin
- secure company’s upstream relations
Kraljic Matrice
- High supply risk + High profit impact = strategic items (partnership)
- Low supply risk + High profit impact = leverage items (purchasing power)
- Low supply risk + low profit impact = non-critical items (simple & automatic)
- High supply risk + low profit impact = bottleneck items (ensure supply)
