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8 Cards in this Set
- Front
- Back
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What does procurement mean?
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Purchasing
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What are the five objectives a procurement department should do?
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1. Need to support all organizational goals
2. Must manage the purchasing process to be effective and efficient 3. Manage your supply base 4. Must have relationships with all functional groups within the organization 5. Support operational requirements |
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What are the five steps of selecting suppliers?
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1. Identify the need for supply
2. Situation analysis - look at internal factors (supply policies) and external factors (legal issues) 3. Identify and evaluate potential suppliers - Request for quotation, narrow down possible suppliers, request for proposal 4. Select suppliers 5. Evaluate decisions |
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Single Source Approach
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purchases are made through one supplier in order to lower costs and increase cooperation/communication in the supply relationship
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Multiple Source Approach
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Having more than one supplier - this increases competition between the suppliers, mitigates risks between the suppliers, and improves market intelligence
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What is the global sourcing development model?
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searching the global markets for two reasons:
1. the factor-input strategy - seeking low cost or high quality sources of supply 2. market-access strategy - sourcing in markets where an organization plans to do significant business |
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Four types of materials
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1. Excess materials - surplus of materials
2. Obsolete - ordered too much; leftovers are not needed 3. Scrap materials - result of manufacturer completing the process 4. Waste material - spoiled materials not fit for re-use |
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Five areas of socially responsible purchasing
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1. Diversity - suppliers are different races/nationalities
2. Environment - holding suppliers responsible for environment 3. Human rights - Labor is taken care of by suppliers 4. Philanthropy - suppliers support community 5. Safety - the suppliers transportation program safe for the general public |
