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Onsite Seminar

Cost & Price Strategies

Supplier Cost Management: Applied Best Practices That Ensure Minimum Total Cost

Course Outline

Orientation and introductions

Cost and price analysis
  • Looking at the supplier: the financial review
  • Common analytical tools
  • Ratio analysis
  • Options for cost reduction
  • The concept of "value"
  • Pricing information: how to get it, what to do with it
  • Case analysis and applications

Purchase of capital assets
  • Budget considerations
  • Cost characteristics
  • Decision-making process
  • Service agreements
  • Buy vs. lease
  • Buying used equipment
  • When, where and how to buy
Purchase of services
  • Characteristics of service vs. material purchases
  • Importance of a Statement of Work (S.O.W.)
  • Defining requirements
  • Defining quality, delivery and price terms
  • Supplier Quality System and Assurance Analysis (certification, ISO 9000, CPK analysis, etc.)
Outsourcing and make vs. buy
  • Basis for an outsourcing agreement
  • Characteristics of a successful program
  • Disadvantages of outsourcing
  • Balancing cost and value
  • The systematic steps of value analysis

Analysis of the supply management system: how to ensure effectiveness and efficiency
  • The necessity for change in supply management systems
  • Steps in assessing the purchasing processes
  • Determining the impact of volume, complexity, redundancy
  • Improvements through technology
  • Application of industry "best practices"
Purchasing: cost center or profit center?
  • Purchasing's value-adding activities
  • How to identify non-value adding activity
Measuring purchasing's performance
  • Focus on process effectiveness and efficiency
  • Organization, functional, team and individual metrics
Who Should Attend

Supply management professionals who would like to obtain the minimum total cost when negotiating with suppliers for goods and services.