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LOGISTICS (REVIEWER)
CH4: PROCUREMENT
4.1 Procurement Objectives
Continuous supply
Minimize inventory investment: Just-in-time (JIT) means to have needed materials arrive just at the moment they are used in the production
process according to schedule.
Quality improvement: quality of finished of goods and services is dependent to its raw materials and components.
Supplier development: manufacturer might share production schedule with key suppliers; retailer might share point-of-sale information and
promotional plans to update suppliers on quantity.
Access technology and innovation: to aid design to the company from the outside.
Lowest total cost ownership is the difference in perspective between a traditional adversarial and more contemporary collaborative
procurement strategy as contrasted to focus on purchase price (including service and life cycle costs). The purchase price must be debundled or
done at an individual basis from price of services under consideration.
LOGISTICS (REVIEWER)
CH4: PROCUREMENT
4.1 Procurement Objectives
Continuous supply
Minimize inventory investment: Just-in-time (JIT) means to have needed materials arrive just at the moment they are used in the production
process according to schedule.
Quality improvement: quality of finished of goods and services is dependent to its raw materials and components.
Supplier development: manufacturer might share production schedule with key suppliers; retailer might share point-of-sale information and
promotional plans to update suppliers on quantity.
Access technology and innovation: to aid design to the company from the outside.
Lowest total cost ownership is the difference in perspective between a traditional adversarial and more contemporary collaborative
procurement strategy as contrasted to focus on purchase price (including service and life cycle costs). The purchase price must be debundled or
done at an individual basis from price of services under consideration.
