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Blog

Services in the field of procurement optimization, building a procurement system and procurement outsourcing are widespread in the world. Most of the routine work is usually outsourced to specialized companies that professionally provide various procurement services.

Procurement outsourcing is the transfer of specialized procurement operations related to sourcing and supplier management to a third party to help companies focus and strengthen their core competencies. Outsourced procurement is a good option for those companies that do not have internal competencies, but are willing to quickly develop procurement functions in order to achieve savings, maximize profits, and structure processes and knowledge. This is also due to the fact that it is not always possible for specialists in the company to conduct correct negotiations with complex suppliers, or they do not exist at all. During negotiations, it is necessary to carefully approach complex suppliers. Consideration should be given to the circumstances when choosing negotiation methods. The more vendors available as alternatives, this will allow the purchasing department to use “tougher” negotiating tactics. The fewer alternatives available will require the purchasing department to use more “selling” persuasion methods. Management shows itself here. More recently, in companies, we could observe the following picture: the division of the workload among purchasing managers was based solely on the number of suppliers. The reason for this situation, as a rule, is the lack of competent specialists. With such a division of the load, the trading company, firstly, receives incorrect inventories. For example, several purchasing managers form orders for the same type of product inconsistently. As a result, the company will receive more than enough products for a long period of time. Secondly, with simultaneous or close deliveries, the work of the warehouse is disrupted. Thirdly, products that are in the warehouse for a long time reduce the logistics in the warehouse. Fourth, there is a re-grading due to a large amount of goods, as a result of which there is a decrease in sales for the assortment. Fifthly, the share of defective goods in the total mass of products is sharply increasing. Sixthly, it is necessary, within the time period determined by the deferral of payments, to deposit funds for the goods that the trading company received in threefold amount. Thus, the company will not have free assets either to pay for the existing product, or to purchase the next lots of a new one after a certain period of time for such work, and the funds will be “frozen” in your warehouses in the product. Any trading company works primarily for the purpose of making a profit and all actions should be considered from the point of view of profitability. Therefore, it becomes necessary to distribute the workload exclusively within the product groups. In this case, the manager clearly knows about the similar positions in the product group, the delivery time of the goods to the warehouse, the presence of illiquid assets, etc., which of course is not provided for in every company as in the purchasing outsourcing companies.

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Blog

Blog

October 18, 2021
Services in the field of procurement optimization, building a procurement system and procurement outsourcing are widespread in the world. Most…
Daha ətraflı

Consulting company “SME” was founded by Doctor of Economics and lawyer Namazov Ilgar in 1990.

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