Purchasing & Logistic Education Courses and Training:
APICS / CSCP (34)
Truck mounted crane (17)
Professional Competence Directive (96)
Contract Management (49)
Enterprise Resource Planning (18)
Dangerous Goods (70)
Forklift Certificate (350)
Procurement Management (313)
Logistics Management (82)
Logistics Employee (19)
Warehouse worker (18)
Reach Truck (178)
Supply Chain Management (SCM) (134)
Working safely along the road (16)
Inventory Management (134)
Truck (Driver’s license) (7)
Purchasing is the process of purchasing products, goods or services. Many companies and organizations have employees who are responsible for purchasing.
The purchaser acquires goods and services from external suppliers. The purchasing process is divided into strategic, tactical and operational purchasing.
The goods and services purchased by an organization are often divided into “direct purchasing”, all goods and services directly related to the final product / service, and “indirect purchasing”. Indirect stands for everything that supports the primary process or production process, such as maintenance, energy, temporary workers, office supplies, etc. Indirect purchasing is also referred to as NPR, which stands for Non Product Related. Direct purchasing is also referred to as BOM, which stands for Bill-of-Materials (bill of materials).
Strategic purchasing can relate to the purchasing function as a whole and to the purchasing strategy for a specific group of goods or services. The purchasing function can play a strategic role if it seeks to align with the strategy of the organization as a whole. When the organization pursues an innovation strategy, the purchasing function can make the strategic choice to contract innovative suppliers. When the organization has a low cost strategy, the purchasing function can focus on cost control.
The purchasing function can formulate a specific purchasing strategy for each individual group of goods and services that are purchased (eg office supplies, temporary workers, raw materials, semi-finished products). Such a separate group of goods and / or services is also referred to as a purchasing category. For one purchasing category, price can be very important and different suppliers can be played off against each other. For another category, delivery reliability can be much more important than price, and a different way of purchasing is necessary. The purchasing strategy for a category consists of choices regarding the priorities to be emphasized (price, quality, delivery reliability, etc.) and the way in which suppliers are approached.
In tactical purchasing, a choice is made which supplier may supply the goods or services at what price and purchasing conditions. Other factors than price also play a role in the choice of supplier. The purchaser must also consider the purchasing policy of his own company in his considerations. In addition to price, the choice is therefore determined by political considerations and the long-term customer-supplier relationship.
Political considerations may include the supplier’s attitude to the environment, child labor and human rights.
Reciprocity and friendly relationships regularly play a soft role in the choice of suppliers. A customer party quickly becomes a supplier and vice versa. As a buyer, it is important to stay sharp in such situations. Rationality sometimes shifts to the background. That is why it is increasingly often decided to have a number of purchasing flows purchased by specialized purchasing agencies once in a number of years in order to regain this rationality. This forces the purchaser to record and scale up the decision criteria (usually laid down by the agency in a kind of Initial measurement).
The relationship can be entered in various ways. Depending on the product, the buyer makes a choice for one supplier or several suppliers. The advantage of one supplier is that the relationship is closer and that a co-makership can be entered into. The advantage of several suppliers is that if the preferred supplier fails (bankruptcy / fire / strike), it is easy to switch to another supplier and the flow of goods is not hindered.
In operational purchasing, orders are placed for well-known products and services that (usually) fall within a framework contract. The delivery time is also monitored and contact is maintained with the supplier to ensure that the items ordered are delivered at the right price, at the requested time, place and quantity.
Logistics is the organization, planning, control and execution of the flow of goods, and the science of this. This starts from the development and purchase of a product, through production and distribution to the end customer, and aims to meet the needs of the market at optimal costs and capital use. The reverse goods flow reverse logistics is also included in the logistics domain. There is a strong relationship with the concept of Supply chain management (SCM).
A short definition of logistics is “the right things, at the right time, in the right place, in the right quantities at minimal cost.”
This involves striking a balance between often difficult to reconcile objectives: on the one hand, cost minimization or low capital consumption is desired, and on the other hand, the aim is to maximize customer service. In a rapidly changing world, more and more companies consider that good logistics control is an absolute requirement.
A warehouse is a space in which goods are temporarily stored.
This space is often divided into locations. It is then kept in an administration which product is at a certain location, and in what quantity. Goods are placed both in block stacking and in warehouse racks, depending on the version and dimensions of the goods to be stored.
The following systems can be used:
- block stacking
- stake positions
- shelf or archive racks
- long-span racks
- pallet racks
- high-rise racks
- drive-in racks
- cantilever racks
- roll-out racks
- drawer racks
- mezzanine or landing floors
Automated warehouses are built from one of these types of racks and then expanded with cranes or manipulators and roller conveyors, which replace the human actions of loading and unloading in the racks.