Supplier Risk Management Research

Purchasing is an essential part of business operations especially in manufacturing industry. How to increase inventory turnovers while fulfilling the basic production requirements and how to reduce purchasing cost while managing supply chain efficiently are the two problems that enterprises have to face directly.In the demand oriented activities of for-profit corporation, purchasing activities is the vital guarantee of company continuous improvement. Modern management practices have proved that supplier risk management directly affects purchasing activities of enterprises. In addition, it will have fatal influence on normal production and operation of corporation. According to risk management and its related theory, this article systematically illustrates supplier risk management theory and tool. Combining the actual situation of A company, it analyzes the problems of supplier risk management of A company, dissects the causes of its supplier management risk, and optimizes the supplier risk management of A company. A company is a traditional enterprise whose risk management practice is in the early stage. The article elaborates how to design the supplier risk management model that is suitable for A company current situation under risk management. Moreover, it uses risk list as reference to design related internal control that helps to carry out the supplier management goal, risk distribution and control measure of A company.