Study On The Cost Management Of L Pharmaceutical Company From The Perspective Of Value Chain

In recent years,the national economy has been growing continuously,people’s demand for medical products is increasing,and the pharmaceutical industry has maintained a rapid development under this background.With the implementation of policies such as "two-ticket system" and "purchase with quantity",the profit of the pharmaceutical industry is getting lower and lower.the cost of drugs as the most powerful weight in the market competition of pharmaceutical enterprises,cost management is bound to become the permanent subject faced by pharmaceutical companies.In the late 20th century,China gradually understood the concept of value chain.In order to gain more cost advantages,Chinese advanced scholars and experts gradually integrated the concept of value chain and cost management.In the fierce market competition,the pharmaceutical industry has also begun to increase the awareness of cost management.The theory of value chain is mainly to judge whether each production link exists and what kind of link exists,and compare the value chain of a single enterprise with that of the whole industry.And analyze the cooperation mode between the upstream suppliers and downstream customers to find the equilibrium point of enterprise development,so as to obtain greater competitive advantages.In our long-term planned economy,enterprises tend to only pay attention to the management of production costs in cost management,but lack of consideration for the supply and sales links of enterprises,and do not care about the external value chain of enterprises.With the development of market economy,enterprises are facing great pressure.This kind of cost management concept can not meet the requirements of market economy environment.From the perspective of cost drivers,the cost of any kind of product from raw material purchase to profit can not only be understood as the cost generated in the manufacturing process,but should be the total cost throughout the product life cycle.The connotation of cost management should also expand the cost of material products to the cost of non-material products,such as human resources cost,capital cost,service cost,environmental cost and so on.If an enterprise wants to gain an advantage in the market competition,it should comprehensively measure the factors of each link and eliminate the links that do not add value,so as to lay a foundation for the development of the enterprise.By analyzing the financial data of L Pharmaceutical Company over the years,this paper found that the internal value chain of L Pharmaceutical company had problems such as unreasonable purchasing mode,unreasonable production arrangement,low R&D conversion rate and high sales cost in the research and development stage,and frequent supplier change and low customer stickability in the vertical value chain.The horizontal value chain has the problems of lack of understanding of competitors and the relationship with important suppliers does not meet the needs of the supply chain environment.Finally,the paper puts forward corresponding solutions to the problems existing in the value chain of L pharmaceutical company,hoping that L Pharmaceutical Company can do better in cost control.