Study On Products Procurement Strategy For X Corporation

With the deepen of economic integration of globalization and China’s rapid developmentof economy after joining the WTO, information technology is deployed and developed inlogistics field, the express companies across the world is facing a common market ofeconomic globalization. In recent years, e-business and network economy developenormously, express companies encounter higher requirements and brutal competition. It cannot maintain the competition advantage of logistics firms which is based on technology,capital and logistics network historically. All express companies are making efforts tobroaden source of income and reduce expenditure by deployment of procurement department.Many companies strengthen management of procurement and attach importance to it which isbecoming a new way of reducing total cost of ownership.In my study of this thesis, the procurement feature and current purchasing status, whichis a world500-fortune firm, have been analyzed for X Corporation. Compared to purchasingactivity in manufacture, express company has wide network across the world. Each center,distribution and hub purchase various materials with small quantity, has limited warehousespace. The distribution cost is relatively high, many packing products are customizedaccording to different customers, and these are tough issue to handle in logistics field.Secondly, the author studies a number of research result, dissertation and theory of expertsand scholars, in order to solve high purchase price, long lead time and unreasonable inventorylevel, in light of weak performance of QPR of procurement department in X Corporation. Thefeasible improvement strategies such as multi-suppliers, direct purchasing, procurementprocedure optimization, centralized and decentralized purchasing, shorten distribution time,enhancing forecast accuracy, improving inventory level have been proposed through the useof Kraljic matrix, fishbone diagram, procedure optimization, liner regression, probability tocalculate safety stock, centralized and decentralized procurement theory, TCO theory andbargaining theory. Finally, the purchase cost, lead time and inventory on improvement resulthave been summarized by implementation assurances of employees training, top managerssupport and ERP system improvement.In order to enhance procurement benefit of X corporation, the strategies and methods are analyzed on how to reduce purchasing cost, shorten lead time and improve inventory,eventually reduce the TCO, guarantees stable supply of materials, increases the competitionof X corporation. It hopefully provides a case study of procurement management for otherexpress companies and relevant firms.