T Company Raw Material Purchase Cost Control Research

The cost of raw materials accounts for 60%-80% of the overall product composition of the manufacturing industry,and the main raw materials are significantly affected by the market,and the price changes are often large,which has a significant impact on profits.Purchasing cost is known as the "third profit source".Traditional purchasing cost analysis focuses on price and ignores other invisible costs.At present,most enterprises have realized the importance of procurement cost control,and introduced e-procurement platform in the bidding process,but it is still an important problem to comprehensively reduce the cost of the whole procurement process.T company’s Spandex chemical fiber industry has developed into a bottleneck period,with fierce competition among enterprises and obvious profit advantages of industry leading enterprises.T company’s main spandex business has been losing money year after year,and its raw material purchase cost accounts for a relatively high proportion.Reducing the purchase cost plays an important role in improving the operation of T company.Based on the theory of total cost of ownership,supplier selection and other related theories,this paper analyzes the present situation of procurement cost control in T company.Through the analysis of the whole process of procurement and storage,it is found that T company has some problems,such as unreasonable supplier development and evaluation,low efficiency of procurement process,high inventory and lack of overall procurement cost control concept.Aiming at the problem of procurement cost control in T company,this paper puts forward the procurement cost control scheme.It includes three parts: First,in terms of purchasing cost control method based on TCO,explicit cost and implicit cost are reduced from the perspective of price cost,communication cost,inventory cost,quality cost and out-of-stock cost by analyzing the purchase cost structure of T Company.Secondly,in the aspect of improving the supplier management system,the supplier selection system based on karaoke matrix and the model of Q.C.D.S.are used to evaluate the supplier performance,so as to enhance the advantages of T company in price negotiation and reduce the risk of out of stock loss and material shortage.Thirdly,in the aspect of constructing the environment of purchasing cost control,we can achieve the effect of full participation of purchasing cost by increasing the incentive mechanism of personnel.With the implementation of the above solutions,T company’s procurement cost will reduce its total cost of ownership in five aspects: procurement price,storage cost,inventory cost,shortage cost and quality cost.Through the research and analysis of T company’s raw material procurement cost,this paper aims to summarize and point out the existing problems of T company’s procurement cost control,and look for possible optimization ways and specific schemes,so as to improve the raw material procurement cost control,improve the company’s profit margin and enhance the industry competitive advantage of the company’s products,so as to provide reference for the similar situation of T company It can be used for reference by fiber molding enterprises.