Analytical Methods for Improved Purchasing Performance

Core Purchasing Strategies
• Supplier optimisation
• Total quality management
• Risk management
• Global sourcing
• Vendor development
• Green purchasing

Key Performance Indicators of Purchasing
• Cost saving
• Quality
• Delivery of purchase items

Metrics of Purchasing Performance
• Efficiency
• Effectiveness
• Functionality

Steps to Purchasing Practices
• Get buy-in to review purchasing performance
• Understand current buying policies and procedures
• Assess impact on suppliers, workers and buying businesses
• Develop an improvement plan
• Implement the plan

Factors Influencing Purchasing Performance
• Operational and administrative activity
• Commercial activity
• Part of integrated logistics
• Strategic business area

Improved Methods for Evaluating Purchasing Performance
• True cost
• Saving
• Inventory flow
• Transportation

General Purchasing Improvement Methods
• Centralise purchasing
• Plan for purchases
• Focus on quality
• Purchase locally
• Build long-term supplier relationships
• Explore outsourcing purchasing
• Ensure top management agreement
• Understand inventory carrying costs
• Base supply-chain management on real-time demand
• Negotiate constantly
• Maintain a clear, documented purchasing strategy
• Ensure adequate training

Benefits of Evaluating Purchasing Performance
• Better decision making
• Better communication
• Better visual inspection and checks
• Better motivation

FOR WHOM:
Stores Purchasing and Logistics Personnel in the Public and Private Sectors