CBC Company China Procurement Cost Control Research

There has been increasingly fierce competition within the marketplace. In such an era, the CBC Company is facing the pressure to deal with continuously rapid changes of the market demand, shorten delivery time, improve quality, reduce the cost and to improve the service. Backing to2001, CBC Company has been appointing a staff focused on China sourcing. In order to adapt the increasingly procurement from China, in August2004, CBC Company formally set up Sourcing Department here in Shanghai, China. With the China sourcing volume increment on fast basis, procurement cost has been rising, accordingly. How to decrease the procurement cost and how to implement cost control becomes one of key important tasks for CBC Company business operated in China.This paper combines the current situation of CBC with related theories and does research on how to control purchasing cost. The main contents include the following parts:First, this paper gives analysis of domestic and international research outcome of purchasing cost theory including basic concepts of the procurement cost control, procurement cost control methods and procurement cost control theoretical literature on the theory of procurement costs. Second, it analyzes the CBC company procurement activities and status of purchasing management and it analyzes the existing issues of CBC company purchasing management. Meanwhile, it analyzes the CBC procurement cost structure from the internal, external and accidental factors. Finally, this article elaborates the major strategies of reducing CBC China procurement cost, and proposes the countermeasures to ensure of CBC Sourcing strategy implementation.