On purchasing cost management.
Based on analyzing the purchasing cost, this paper probes into the steps of controlling the purchasing cost. Excellent procurement cost management lies in adopting cost control methods suitable for the actual situation of enterprises. Only by correctly solving the key elements of cost control can enterprises establish a long-term and stable development route and competitive position.
Keywords: procurement; Cost management; Control method selection
China Library Classification Number: F270 Document Identification Number: Part A Number:1008-4428 (2013)10-20-02.
Purchasing is a transaction process in which an enterprise chooses the channel, mode, quality, price and opportunity of the purchasing object and converts monetary funds into the subject matter in order to obtain goods or services under the condition of market economy. Purchasing is not only a kind of buying behavior, but also the whole process from market forecasting, through commodity trading to transferring the purchased goods or services to the buyer.
In the whole process of purchasing activities, on the one hand, resources are obtained through purchasing, which ensures the smooth progress of normal production of enterprises, which is the benefit of purchasing; On the other hand, in the procurement process, various expenses will also occur, which is the procurement cost. We want to maximize the economic benefits of procurement, that is, to continuously reduce procurement costs and obtain maximum benefits with the least cost. To do this, the key is to strive for scientific procurement. Scientific procurement is the basic profit source for enterprises to maximize their economic benefits.
First, the procurement cost analysis
Procurement cost accounts for a large proportion in the total cost of all kinds of enterprises, and it is an important link of enterprise cost control. The key to the composition of procurement cost is to distinguish narrow-sense cost from broad-sense cost.
(A) the narrow sense of procurement costs
In a narrow sense, procurement costs include obvious ordering process costs (including the cost of obtaining goods and ordering business expenses, etc.). ), as well as the inventory maintenance cost and untimely out-of-stock cost affected by procurement. But the narrow sense of procurement cost does not include the price of materials.
1. Order cost refers to various costs incurred in the process of reaching a purchase contract with suppliers and issuing orders to them in order to complete trading activities. Some of these costs are not directly related to the quantity or quantity of the order, such as the cost of setting up a purchasing agency or office, which is called the fixed cost of the order; The other part, such as tourism, postal service, communication, catering, etc., changes with the quantity or quantity of orders, which are all called order change costs.
2. Maintenance cost refers to the expenses incurred to keep the quantity and nature of goods and materials unchanged. It can also be divided into fixed cost and variable cost. The former such as warehousing depreciation, warehousing labor, etc. ; The latter, such as capital occupation, material damage and deterioration, insurance premiums and taxes.
Maintenance costs should not be underestimated, because maintenance costs often account for most of the procurement costs. The annual maintenance cost often varies greatly, ranging from 9% to 50%, and supermarket enterprises generally account for about 20%, which mainly depends on the inventory policy of supermarkets.
3. Out-of-stock cost refers to the loss caused by the delay of continuous supply of procurement, such as waiting for production, stopping work, delaying delivery, losing sales opportunities, losing customers, etc.
(B) procurement costs in a broad sense
The generalized procurement cost is also the overall procurement cost, which can also be called the strategic procurement cost. Refers to all costs related to the purchase of products and materials in the whole material production cycle. For example, the cost of purchasing market research, the cost of purchasing decision, the cost of suppliers participating in product development, and the cost increase or loss caused by suppliers participating in delivery, inventory, production, quality inspection and after-sales stages.
The control and analysis of procurement cost mainly focuses on the overall procurement cost, and the ultimate goal is to reduce the overall procurement cost.
Starting from various functions of the total cost, the total cost can be divided into the following costs:
1. The possible costs due to supplier selection and supplier participation mainly include the cost increase caused by raw materials and spare parts that affect product specifications and technical level; Expenses arising from the audit of suppliers at all levels; Expenses incurred during the identification of raw materials or parts; Impact and loss caused by unqualified raw materials and parts.
2. The cost of the procurement process. Mainly including commodity purchase price and process cost; Document processing fee; Exchange rate and interest expenses caused by payment terms; Material transportation and insurance costs, etc.
3. Procurement costs incurred in the course of operation. If the delivery fee is received; Safety inventory cost, inventory interest; Return, packaging and transportation expenses caused by unqualified products; Inventory cost of raw materials and parts; Management expenses, etc.
4. Procurement cost in quality control. Including supplier quality system audit confirmation; Inspection fee; Influence of nonconforming products on production and delivery; Rework and return expenses caused by unqualified products.
Second, make the purchase cost control plan
The ultimate goal of purchasing personnel is to reduce the overall purchasing cost. After analyzing the overall procurement cost, a feasible procurement cost control scheme should be formulated. Every step of the procurement cost control scheme directly affects the realization of the control effect.
(A) Analysis of internal and external factors affecting the formation and change of procurement costs
Firstly, according to the narrow sense of purchasing cost, the possible factors affecting ordering cost, maintenance cost and out-of-stock cost are analyzed. Then carefully and closely analyze the supply price factors.
(B) the development of procurement cost standards
As the criterion of cost control, cost standard is generally manifested as various indicators in cost planning, and so is procurement cost control. According to the concept of overall procurement cost, different enterprises need to formulate a series of specific standards according to their own actual situation. There are three ways to determine these standards.
1, plan index decomposition method. That is, the big indicators are decomposed into small indicators. When decomposing, it can be decomposed by departments and units, or by different products and process stages or parts of various products. If it is more detailed, it can also be decomposed by process.
2. Budget law. It is to formulate control standards by formulating budgets. Some enterprises basically make short-term (such as monthly) expense budgets according to quarterly production and marketing plans and purchasing plans, and take this as the standard of cost control. Purchasing in this way requires setting and adjusting the budget from reality.
3. Quota method. It is to establish quotas and expense limits and control them as standards. In an enterprise, where quotas can be established, it is necessary to establish quotas, such as material consumption quotas and working hours quotas. The method of quota control is beneficial to the concretization and standardization of cost control.
(three) the formulation of procurement cost control norms, supervision of the formation of procurement costs
Enterprises can form a perfect procurement cost control standard through system construction, so as to regularly inspect, evaluate and supervise the procurement costs according to the control standard. Establishing a strict procurement system can not only standardize the post-procurement activities of enterprises, improve procurement efficiency, prevent the intensification of contradictions between departments, but also prevent the bad behavior of procurement personnel. First of all, the procurement system should stipulate the application for purchasing materials, the authorization authority of the authorized person, the procurement process, the responsibilities and relations of relevant departments, the provisions and methods of purchasing various materials, quotation and price approval, etc. Secondly, it is necessary to establish supplier files and access systems; At the same time, it is necessary to establish a price file and a price evaluation system, organize a special team to compare and analyze the prices of purchased items, and on this basis, formulate standard purchase prices and cost standards, and reward and punish procurement personnel according to their work performance. The management of suppliers by enterprises needs to be strengthened. At present, there is a misunderstanding in the procurement work of many enterprises. It is believed that the procurement work is to have a good relationship with suppliers, and then on the basis of this relationship, seek the running-in and balance with the needs of enterprises. In fact, this situation is very dangerous for enterprises. It is very important to establish a good personal relationship with suppliers in purchasing. In the long run, it will lead enterprises to rely on some suppliers, which is not conducive to enterprises to find new and better suppliers, technological innovation, internal corruption and damage the interests of enterprises.
(4) Correct mistakes in time.
For the reasons of cost difference, find out the responsible person and give corresponding measures according to the situation, and put forward the improvement methods respectively and implement them.
Third, the key factors to control procurement costs
The key factors of purchasing cost control, taking manufacturing enterprises as an example, refer to the control of material purchasing, warehousing and storage, and the assessment of purchasing departments.
(A) the control of material procurement
Generally, purchased goods, outsourced parts, components and other materials needed for production are purchased in a centralized way and supplied in a unified way, with the aim of realizing bulk purchase and reducing procurement costs.
The purchasing department prepares the purchasing plan according to the demand plan put forward by the production planning department and the inventory situation. When organizing procurement, we should strengthen market research, insist on shopping around, implement a competitive mechanism, and implement the procurement principle of high quality and good price. At the same time, according to the actual situation of the enterprise, determine the approval authority of the purchase quota. In addition, materials frequently purchased in the market can be purchased at designated locations.
(2) Material storage control
After the materials arrive at the company, the purchasing personnel should fill in the receipt form in time, and the warehouse keeper and inspector should adopt various measurement methods according to the different forms of materials, accurately measure them and carefully check and accept them. The finance department should strengthen accounting supervision and review the specifications and procedures of contracts or plans, invoices and receipts. At the end of the year, the purchasing department should make a comprehensive inventory of property inventory according to the requirements of financial statements to ensure that the accounts are consistent with the facts. And organize all departments to check the balance of unused materials received by the mall.
(3) Evaluation of purchasing department
The company regularly issues cost control indicators and evaluates the purchasing department accordingly:
Material purchase price difference =? Actual purchase volume in that year? (current purchase price-last year's purchase price)
Stock loss =? Quantity loss of purchased goods? Purchasing unit price
Decrease in purchasing cost = total amount of goods purchased this year? (This year's purchase expense rate-last year's purchase expense rate)
The finance department sets up bills to account for purchasing expenses and losses respectively.
Fourth, the choice of procurement cost control methods
There are many options for cost control methods of enterprises: value analysis (VA), value engineering (VE) and ABC classification control method; In addition, enterprises can also achieve the purpose of cost control through the adjustment of purchasing mode and strategy, which generally includes JIT purchasing strategy, online purchasing strategy, centralized purchasing strategy, joint purchasing strategy, establishing purchasing alliance or signing long-term purchasing agreement with suppliers, sunshine purchasing strategy and international purchasing strategy.
The choice of purchasing cost control method is closely related to the nature of goods purchased by enterprises. Generally speaking, the goods purchased by various industries can be divided into four categories: leveraged products, strategic materials, general products and bottleneck products.
For general products with low purchasing risk and small purchasing amount, the focus of cost control is to reduce purchasing management costs and reduce purchasing frequency. Among them, general orders, comprehensive suppliers and long-term cooperation can all be controlled.
For leveraged products with low purchasing risk and large purchasing volume per unit time, procurement personnel are required to have enough professional knowledge to analyze the cost of a single product by using VA and ve methods. In addition, it is necessary to cultivate potential suppliers and obtain appropriate purchase prices through effective price competition. Of course, suppliers should remain relatively stable.
For strategic materials with high purchasing risk and large purchasing volume per unit time, besides analyzing the cost of a single product, it is more important to monopolize resources, ensure supply and establish a stable and stable supply relationship with suppliers.
For bottleneck products with high purchasing risk and small purchasing volume per unit time, it is necessary to cooperate with suppliers for a long time, make effective collocation and combination, and improve the control ability of scarce resources. Meanwhile, efforts should be made to shorten the payment period.
Procurement management is a systematic and scientific work. Today, with the rapid fluctuation of material price and procurement process cost, it is more important to control the overall procurement cost. How to do a good job in purchasing cost management is the key factor for enterprises to establish their own competitiveness. Doing a good job in purchasing cost management and strengthening the variability of control methods are conducive to the rapid development of enterprises in industry competition.
References:
Wang Huailin. Procurement management and inventory control [M]. China Materials Publishing House, 2008.
[2] Song Jian. Basic knowledge of modern science and technology [M]. Beijing Science and Technology Press, 2008.
[3] Huang Changhua. Procurement supervisor's efficient work manual [M]. Machinery Industry Press, 2008.
About the author:
Liu, male, from Langfang, Hebei Province, is a master of business administration in Southeast University, and now works for Nanjing Veolia Environmental Services Co., Ltd.
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