Profitable buying strategies: how to cut procurement costs and buy your way to higher profits
Saved in:
| Main Author: | |
|---|---|
| Format: | Book |
| Language: | English |
| Published: |
London ; Philadelphia
Kogan Page
2008
|
| Subjects: | |
| Online Access: | Inhaltsverzeichnis |
| Physical Description: | xvii, 237 Seiten |
| ISBN: | 9780749452384 |
Staff View
MARC
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| 245 | 1 | 0 | |a Profitable buying strategies |b how to cut procurement costs and buy your way to higher profits |c Mike Buchanan |
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| adam_text | Contents
List of figures xi
List of tables xii
List of case studies xiv
Preface and acknowledgements xvi
Introduction 1
1. The philosophy and psychology of buying 7
The philosophy of buying 7; The psychology of
buying 9; Vendor conditioning of buyers 15; Personality
types and aptitudes 16; Risk management 17
2. Important buying-related concepts 21
Terminology - cost reduction, cost containment, cost
avoidance 22; The buying portfolio 23; The Pareto
Principle (the 80/20 rule ) 25; Single sourcing and
multi-sourcing 26; Buying power and intrinsic
cost reduction 27; Market segregation 30; Quality 31;
Total cost of ownership ( TCO ) 31
viii Contents
3. Effective tools and techniques 34
Spend mapping 35; Estimating and targeting
cost savings opportunities 37; The buying cycle 41;
Price benchmarking 45; Specifications - goods 47;
Specifications - capital equipment 49; Specifications -
services 52
4. The changes that deliver cost reduction 54
Engage the current vendor(s), and potential new
vendors 55; Change what is bought 55; Change how it is
bought 57; Change when it is bought 66; Change who buys
it 67; Change where you buy it from 67; Rent rather than
buy? 68; Involve procurement at an earlier stage in the
buying cycle 70
5. Market testing 72
Why market testing is so important 72; Different types of
market testing 74; Locating potential new vendors 76;
Buying internationally 78; Market testing in difficult
markets 82; Case studies 83
6. Outsourcing and insourcing 87
Background 87; Deciding what to outsource 88;
Levels of outsourcing 89; The top three legal issues 91;
Insourcing 96
7. Negotiation t 97
The distinction between buying and negotiating 98;
Aligning style and tactics with the nature of the
buyer-vendor relationship 98; Why most people are poor
negotiators 99; How to develop your negotiating
abilities 99; The five golden rules of effective
negotiation 100; Minimum and maximum settling points
(MSPs), and the killer question 103; The buyer s power
over the course of the buying cycle 106; How to leverage
your buying power 107; Vendor pre-conditioning 108
Contents ix
8. Contracts and contract law 110
Why formal contracts are important 111; Contract
fairness 112; Contract duration 112; Which contract terms
to use 115; Vendor terms to be challenged 116;
Developing your own contract terms 117; Contract
termination 117; Contract terms and the buying cycle 121;
Contract register 121
9. E-procurement 123
Background 123; Terminology 124; The development of
e-procurement 125; A brief introduction to auctions -
Dutch, Chinese, reverse, electronic, English... 126;
E-auction do s and don ts 127; eWorld 127;
An overview of e-procurement - The Aberdeen
Group 127; E-procurement enabler 1 - Procuri 133;
E-procurement enabler 2 - BravoSolution 139;
E-procurement enabler 3 - Vendigital 143
10. Organizational issues 147
Politics 148; Buying development stages 149; Approaches
to buying 149; Building buying capacity and capability:
employees, interim managers, consultants 153;
Maximizing the value derived from external experts 162;
Matching buyer personalities/aptitudes to tasks 162;
Buyer motivation and incentivization 162; Individual
roles, responsibilities and authorities 163; Buyers product
knowledge 164; Buyers contract law knowledge 164;
Buyers competence development 164; Performance
measurement and reporting 165; Ethics 167
Appendix 1: Service level agreement (SLA) 168
Appendix 2: Request for proposal (RFP) 179
Appendix 3: The Chartered Institute of Purchasing
and Supply
Appendix 4: Soft issues impacting on cost
reduction drives 205
x Contents
Appendix 5: Buying at Sainsbury s supermarkets 209
Appendix 6: Buying at SmithKline Beecham 217
Appendix 7: Buyer remuneration in the UK 228
References 233
Index 234
List of figures
2.1 The buying portfolio 23
2.2 Purchasing and the Pareto curve 25
2.3 Common sense relationship between price and demand 28
3.1 Matrix of cost reduction potential when intrinsic cost
reduction potential is HIGH 38
3.2 Matrix of cost reduction potential when intrinsic cost
reduction potential is MODERATE 39
3.3 Matrix of cost reduction potential when intrinsic cost
reduction potential is LOW 39
4.1 The decline in cost reduction potential over the
buying cycle 70
7.1 The development of a buyer s power over the course
of the buying cycle 107
A6.1 Executives need to lead business initiatives that
address both tactical and strategic cost management 220
A6.2 Identify the purchasing portfolio. Ensure that you cover
total spend. Then prioritize the cost reduction targets
for attack 221
A6.3 Sourcing decisions should be taken at the highest possible
geographical level to maximize leverage with suppliers 223
A6.4 Different categories of expenditure demand different
approaches to drive down costs. Resources need to be
allocated accordingly 227
List of tables
0.1 Comparison between profit improvement options 3
0.2 The 10 keys to cost reduction 5
1.1 Basic specification for copier paper 13
1.2 Commonly perceived risks from cost reduction efforts 19
2.1 Supply market difficulty 24
3.1 Spend by spend category, in descending spend order 35
3.2 Spend by vendor, in descending spend order 36
3.3 Savings delivered to a UK professional services firm 37
3.4 Comparison between forecast cost reduction potential
and actual savings delivery at a UK professional
services firm 40
3.5 Basic specification for copier paper 47
3.6 Minimum specification requirements for a 45 ppm copier 51
4.1 The impact of residual values on rental costs 69
5.1 Different approaches to market testing, and when used 76
5.2 Incoterm abbreviations and their meanings 80
6.1 Key considerations to be taken into account, in deciding
whether or not to outsource manufacturing or services 88
8.1 Contract register example 122
9.1 Ensuring a successful e-auction 128
9.2 CPO operational excellence framework 132
9.3 E-procurement competitive framework 134
10.1 Buying development stages within organizations 150
10.2 Approaches to buying 152
List of Tables xiii
10.3 Approaches to staffing a buying function 154
10.4 Cost comparison, full-time employees versus interim
managers 156
10.5 Comparison between different consultancy operating
models 160
A4.1 Sainsbury s five corporate responsibility principles, and
highlights of 2006-07 207
List of case studies
A Yorkshireman seeks a discount on a new car 30
The phone call that saved £60,000 pa 56
Changing ordering patterns for labels saves £150,000 pa 57
Surveys and asset management save a logistics company
£500,000 pa 59
Introducing seasonal pricing for trailers saves a logistics
company £500,000 pa 61
An electricity company reduces its charges, and refunds its
retail customer a total of £446,000 65
A buyer managed for 20 years to be unaware of the existence
of the leading vendor in a market 75
Market testing stationery and print saves a client £1.5 million
over three years 83
Market testing archiving services saves a client £120,000 pa 84
Market testing photocopiers saves a client £400,000 over
four years 85
What should you do with an offer you can t refuse? Refuse it! 104
When I m buying windows 105
The Boots Company saves £3.5 million pa through e-auctions 137
Hotel company forecasts £621,000 cost savings, after an
e-auction for paper napkins and placemats 141
The National Health Service (NHS) saves over £100 million on
temporary staff through a three day long e-auction 142
List of Case Studies xv
Vendigital client gains access to a more appropriate vendor,
and reduces costs by 25 per cent 144
Newburgh Engineering applies Vendigital expertise to its
own supply chain 146
Sainsbury s analyses one of its fruit supply chains improves
growers returns, and makes significant savings itself 211
Sainsbury s delivers environmental benefits, and achieves
significant cost savings on its carrier bags 215
SmithKline Beecham uses cascade training and functional
change to capture post-merger synergies 218
|
| adam_txt |
Contents
List of figures xi
List of tables xii
List of case studies xiv
Preface and acknowledgements xvi
Introduction 1
1. The philosophy and psychology of buying 7
The philosophy of buying 7; The psychology of
buying 9; Vendor conditioning of buyers 15; Personality
types and aptitudes 16; Risk management 17
2. Important buying-related concepts 21
Terminology - cost reduction, cost containment, cost
avoidance 22; The buying portfolio 23; The Pareto
Principle (the '80/20 rule') 25; Single sourcing and
multi-sourcing 26; Buying power and intrinsic
cost reduction 27; Market segregation 30; Quality 31;
Total cost of ownership ('TCO') 31
viii Contents
3. Effective tools and techniques 34
Spend mapping 35; Estimating and targeting
cost savings opportunities 37; The buying cycle 41;
Price benchmarking 45; Specifications - goods 47;
Specifications - capital equipment 49; Specifications -
services 52
4. The changes that deliver cost reduction 54
Engage the current vendor(s), and potential new
vendors 55; Change what is bought 55; Change how it is
bought 57; Change when it is bought 66; Change who buys
it 67; Change where you buy it from 67; Rent rather than
buy? 68; Involve procurement at an earlier stage in the
buying cycle 70
5. Market testing 72
Why market testing is so important 72; Different types of
market testing 74; Locating potential new vendors 76;
Buying internationally 78; Market testing in difficult
markets 82; Case studies 83
6. Outsourcing and insourcing 87
Background 87; Deciding what to outsource 88;
Levels of outsourcing 89; The top three legal issues 91;
Insourcing 96
7. Negotiation t 97
The distinction between buying and negotiating 98;
Aligning style and tactics with the nature of the
buyer-vendor relationship 98; Why most people are poor
negotiators 99; How to develop your negotiating
abilities 99; The five golden rules of effective
negotiation 100; Minimum and maximum settling points
(MSPs), and the 'killer question' 103; The buyer's power
over the course of the buying cycle 106; How to leverage
your buying power 107; Vendor pre-conditioning 108
Contents ix
8. Contracts and contract law 110
Why formal contracts are important 111; Contract
fairness 112; Contract duration 112; Which contract terms
to use 115; Vendor terms to be challenged 116;
Developing your own contract terms 117; Contract
termination 117; Contract terms and the buying cycle 121;
Contract register 121
9. E-procurement 123
Background 123; Terminology 124; The development of
e-procurement 125; A brief introduction to auctions -
Dutch, Chinese, reverse, electronic, English. 126;
E-auction 'do's and don'ts' 127; eWorld 127;
An overview of e-procurement - The Aberdeen
Group 127; E-procurement enabler 1 - Procuri 133;
E-procurement enabler 2 - BravoSolution 139;
E-procurement enabler 3 - Vendigital 143
10. Organizational issues 147
Politics 148; Buying development stages 149; Approaches
to buying 149; Building buying capacity and capability:
employees, interim managers, consultants 153;
Maximizing the value derived from external experts 162;
Matching buyer personalities/aptitudes to tasks 162;
Buyer motivation and incentivization 162; Individual
roles, responsibilities and authorities 163; Buyers' product
knowledge 164; Buyers' contract law knowledge 164;
Buyers' competence development 164; Performance
measurement and reporting 165; Ethics 167
Appendix 1: Service level agreement (SLA) 168
Appendix 2: Request for proposal (RFP) 179
Appendix 3: The Chartered Institute of Purchasing
and Supply
Appendix 4: Soft issues impacting on cost
reduction drives 205
x Contents
Appendix 5: Buying at Sainsbury's supermarkets 209
Appendix 6: Buying at SmithKline Beecham 217
Appendix 7: Buyer remuneration in the UK 228
References 233
Index 234
List of figures
2.1 The buying portfolio 23
2.2 Purchasing and the Pareto curve 25
2.3 'Common sense' relationship between price and demand 28
3.1 Matrix of cost reduction potential when intrinsic cost
reduction potential is HIGH 38
3.2 Matrix of cost reduction potential when intrinsic cost
reduction potential is MODERATE 39
3.3 Matrix of cost reduction potential when intrinsic cost
reduction potential is LOW 39
4.1 The decline in cost reduction potential over the
buying cycle 70
7.1 The development of a buyer's power over the course
of the buying cycle 107
A6.1 Executives need to lead business initiatives that
address both tactical and strategic cost management 220
A6.2 Identify the purchasing portfolio. Ensure that you cover
total spend. Then prioritize the cost reduction targets
for attack 221
A6.3 Sourcing decisions should be taken at the highest possible
geographical level to maximize leverage with suppliers 223
A6.4 Different categories of expenditure demand different
approaches to drive down costs. Resources need to be
allocated accordingly 227
List of tables
0.1 Comparison between profit improvement options 3
0.2 The 10 keys to cost reduction 5
1.1 Basic specification for copier paper 13
1.2 Commonly perceived risks from cost reduction efforts 19
2.1 Supply market difficulty 24
3.1 Spend by spend category, in descending spend order 35
3.2 Spend by vendor, in descending spend order 36
3.3 Savings delivered to a UK professional services firm 37
3.4 Comparison between forecast cost reduction potential
and actual savings delivery at a UK professional
services firm 40
3.5 Basic specification for copier paper 47
3.6 Minimum specification requirements for a 45 ppm copier 51
4.1 The impact of residual values on rental costs 69
5.1 Different approaches to market testing, and when used 76
5.2 Incoterm abbreviations and their meanings 80
6.1 Key considerations to be taken into account, in deciding
whether or not to outsource manufacturing or services 88
8.1 Contract register example 122
9.1 Ensuring a successful e-auction 128
9.2 CPO operational excellence framework 132
9.3 E-procurement competitive framework 134
10.1 Buying development stages within organizations 150
10.2 Approaches to buying 152
List of Tables xiii
10.3 Approaches to staffing a buying function 154
10.4 Cost comparison, full-time employees versus interim
managers 156
10.5 Comparison between different consultancy operating
models 160
A4.1 Sainsbury's five corporate responsibility principles, and
highlights of 2006-07 207
List of case studies
A Yorkshireman seeks a discount on a new car 30
The phone call that saved £60,000 pa 56
Changing ordering patterns for labels saves £150,000 pa 57
Surveys and asset management save a logistics company
£500,000 pa 59
Introducing seasonal pricing for trailers saves a logistics
company £500,000 pa 61
An electricity company reduces its charges, and refunds its
retail customer a total of £446,000 65
A buyer managed for 20 years to be unaware of the existence
of the leading vendor in a market 75
Market testing stationery and print saves a client £1.5 million
over three years 83
Market testing archiving services saves a client £120,000 pa 84
Market testing photocopiers saves a client £400,000 over
four years 85
What should you do with an offer you can't refuse? Refuse it! 104
When I'm buying windows 105
The Boots Company saves £3.5 million pa through e-auctions 137
Hotel company forecasts £621,000 cost savings, after an
e-auction for paper napkins and placemats 141
The National Health Service (NHS) saves over £100 million on
temporary staff through a three day long e-auction 142
List of Case Studies xv
Vendigital client gains access to a more appropriate vendor,
and reduces costs by 25 per cent 144
Newburgh Engineering applies Vendigital expertise to its
own supply chain 146
Sainsbury's analyses one of its fruit supply chains improves
growers' returns, and makes significant savings itself 211
Sainsbury's delivers environmental benefits, and achieves
significant cost savings on its carrier bags 215
SmithKline Beecham uses cascade training and functional
change to capture post-merger synergies 218 |
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| illustrated | Not Illustrated |
| index_date | 2024-07-02T21:21:17Z |
| indexdate | 2024-07-09T21:17:37Z |
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| language | English |
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| spelling | Buchanan, Mike 1957- Verfasser (DE-588)135901812 aut Profitable buying strategies how to cut procurement costs and buy your way to higher profits Mike Buchanan London ; Philadelphia Kogan Page 2008 xvii, 237 Seiten txt rdacontent n rdamedia nc rdacarrier Includes bibliographical references and index Purchasing Industrial procurement Beschaffung (DE-588)4005988-1 gnd rswk-swf Einkaufsorganisation (DE-588)4131687-3 gnd rswk-swf Beschaffung (DE-588)4005988-1 s Einkaufsorganisation (DE-588)4131687-3 s DE-604 HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=016577214&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis |
| spellingShingle | Buchanan, Mike 1957- Profitable buying strategies how to cut procurement costs and buy your way to higher profits Includes bibliographical references and index Purchasing Industrial procurement Beschaffung (DE-588)4005988-1 gnd Einkaufsorganisation (DE-588)4131687-3 gnd |
| subject_GND | (DE-588)4005988-1 (DE-588)4131687-3 |
| title | Profitable buying strategies how to cut procurement costs and buy your way to higher profits |
| title_auth | Profitable buying strategies how to cut procurement costs and buy your way to higher profits |
| title_exact_search | Profitable buying strategies how to cut procurement costs and buy your way to higher profits |
| title_exact_search_txtP | Profitable buying strategies how to cut procurement costs and buy your way to higher profits |
| title_full | Profitable buying strategies how to cut procurement costs and buy your way to higher profits Mike Buchanan |
| title_fullStr | Profitable buying strategies how to cut procurement costs and buy your way to higher profits Mike Buchanan |
| title_full_unstemmed | Profitable buying strategies how to cut procurement costs and buy your way to higher profits Mike Buchanan |
| title_short | Profitable buying strategies |
| title_sort | profitable buying strategies how to cut procurement costs and buy your way to higher profits |
| title_sub | how to cut procurement costs and buy your way to higher profits |
| topic | Purchasing Industrial procurement Beschaffung (DE-588)4005988-1 gnd Einkaufsorganisation (DE-588)4131687-3 gnd |
| topic_facet | Purchasing Industrial procurement Beschaffung Einkaufsorganisation |
| url | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=016577214&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |
| work_keys_str_mv | AT buchananmike profitablebuyingstrategieshowtocutprocurementcostsandbuyyourwaytohigherprofits |