Qilu Petrochemical Materials Procurement Cost Control Research

In recent years, due to the influence of economic globalization and financial crisis in 2008,Profit margin of business fell sharply. Enterprise faced enormous challenges in survival and development. In order to meet the challenge, many advanced enterprise enhanced purchasing method, trying to save cost in supply chain to recover profit margin and improve the company competitiveness in the market.In this article, we will take Sinopec Qilu Company supply chain as a research object, studying from its weak part in supply chain to every details in the cost control of procurement. Firstly, we start from analyzing the logic between procurement cost control and enterprise operation, particularly in accelerating enterprise sustainable development; Secondly, we review the related theory and concept of procurement cost, cost control, supply chain and minimizing Life Cycle Cost; Thirdly, we analysis current situation in Sinopec Qilu Company procurement to figure out the problems by studying data and statistics; then we propose several methods to solve the above problems and assess these proposals; Finally, drawing conclusion from above research, we analysis the shortcoming in the present study and the factor worth further research.The purpose of this article is trying to help enterprise establishing new management philosophy, focusing more on the cost control in procurement, applying methods to solve the problems in procurement management in order to enhance the competitiveness of enterprises. In the mean time, we hope this article could be helpful for other Petrochemical Enterprises in supplying procurement management and enterprises in other industry.