The Study Of Procurement Cost Control On ISR Company

In the Manufacturing enterprises,procurement costs usually account for a high proportion of the product cost. It is to determine one of the main factors of the price level and market competitiveness. Therefore, strengthening procurement management that reduce procurement costs is another source for enterprises to improve profits. However, many enterprises for procurement management role is still far less than the degree of attention,and some problems still exist in the specific implementation of the procurement management process. The one hand, many companies are only in a certain extent for the process management of procurement business. It does not form a supply relationship management. On the other hand, more campany analysis the procurement process of the cost control from the point of view of the enterprise’s own. Relatively small enterprises consider the overall interests of the entire supply chain.That is lack of the concept for cooperation and win-win.This paper researches procurement cost control on the ISR company. The paper contains three parts. The first part introduces the basic concepts of procurement cost control, as the theoretical basis of this study, that is below the theoretical foreshadowing. The second part introduces the current situation of the ISR In the area of procurement that includes the design on procurement process being lack of scientific, the high price of material, inaccurate market forecasts, the problem of supplier management and so on. For the existing problems, the paper specifically analyzes the reasons that include the relatively backward concepts and methods of procurement management,the lack of control on procurement costs, Relatively low degree of Information technology on procurement management, and being lack of the mechanism of supplier management.In The third part, the paper proposed improved methods.Target’s method is to determine the objectives of procurement cost,and material is to be classified to manage.The company should establish a sound procurement system that is batch management for purchase order. The method of process management in the procurement process is to reduce the cost of procurement.The enterprise shoule make use of the way hierarchical management for suppliers, and establish a mechanism of competition.Regular training and assessment of suppliers is Necessary.The last part, the paper concluded and Prospects to procurement cost control.The purpose of this study is to summarize shortcomings of ISR company on procurement cost control, and propose a corresponding improvement.The writer hope the study can help the ISR company to improve the management on procurement cost control. The authors also expect that is a reference of other similar manufacturing enterprises.