Research On The Procurement Cost Management Strategy Of Company A Based On The Whole Life Cycle Theory

With the rapid development of global economy,the competition among enterprises is becoming more and more fierce.If enterprises want to improve their core competitiveness,effective procurement cost management is particularly critical.However,the traditional procurement cost management mainly focuses on the procurement cost in the stage of mass production,and there are problems such as single control stage,lack of foresight and strategy,lack of advance prediction and control.Procurement cost management based on product life cycle theory is more integrated,efficient and sustainable.This paper takes COMPANY A as the research object,based on product life cycle theory,combined with supply chain management,strategic sourcing theory,ABC classification method,value engineering method,target cost method and other traditional procurement cost management methods,carries out A case study on its procurement cost management strategy.Firstly,this paper uses literature research method to sort out the relevant theories and methods of purchasing cost management,laying a theoretical foundation for this study.Secondly,through A company’s main operating indicators and procurement cost data in recent years,analysis of its procurement cost management status.Study found that nearly three years the company’s main business income,main business profit and net profit is declining,and the purchasing cost accounts for the proportion of main business cost is rising,is A company’s current purchasing cost management mode can not effectively control the purchase cost,thus reveal the full life cycle theory is used to the necessity of its purchasing cost management strategy is optimized.Again,based on the theory of product life cycle of A major products of the company’s stage of life cycle,each phase of the procurement cost data and to set the stage of purchasing cost management index were analyzed,summed up A company in the product introduction period,growth period,mature period,decline phase realistic problems of the purchasing cost management,and analyzes problems cause.Further,in view of the procurement cost management problems and causes in each stage of A company’s product life cycle,the procurement cost management strategy is optimized.Finally,the guarantee measures and expected results for the smooth implementation of the optimization strategy are proposed.It is found in this study that optimizing the procurement cost management strategy of COMPANY A based on product life cycle theory will significantly reduce the procurement cost of company A in the product introduction stage,growth stage,maturity stage and decline stage,thus reducing the total procurement cost of company A and improving the core competitiveness of the company.At the same time,this study will provide reference for other manufacturing enterprises to optimize procurement cost management strategy.