Course details

Overview ?

Course Description

The development and implementation of carefully crafted strategies for the acquisition of all goods, parts, equipment, and services has become a critical issue in all organizations wishing to reduce operating cost while improving quality and productivity. This program explores key concepts of Strategic Cost/Price Analysis, Value Analysis, and Total Cost of Ownership that will move today’s supply management organization from its typical tactical focus to the strategic focus needed to successfully implement the processes and methods needed to reach world-class performance.

The Goals

Explore the Elements of Cost In Supplier’s Price
Differences in International Labor Rates
Understand how to Develop a “Purchasing Coding System”
Learn How Volumes Should Impact Price
Discover Supplier’s Different Pricing Models
Explore Issues of Supplier/Contractor Overhead Expenses
Experience the Development of A Purchase Price Index
Obtaining Suppliers Price Breakdowns
Learn how to Get More Time to Work on Strategic Issues
Develop Skills in Negotiation Planning and Strategies
Understand Methods of Price and Cost Analysis
Apply Concepts of Value Analysis
Development of “Should Cost”
Types of TCO Systems
Approach to Implementing TCO Analysis

The Benefits

Attendees will gain by participation in this program through mastering skills in analyzing and understanding supplier’s cost and, as a result, will realize a greater ability to develop professionally and progress toward advancement. Additionally participants will receive increased recognition by their organization due to their improved performance in leading, planning, and managing continuous improvement programs.

The Results

The organization will benefit by having better pricing and reduced total cost of ownership for purchased materials, parts, equipment, and services as well as a greater strategic focus of those involved in supply management. This program offers many take-a-ways that will provide continuous improvement and higher productivity of personnel involved in purchasing and contracting activities. By gaining a better understanding of supplier’s pricing and cost, participants will be able to better accomplish the organization’s business strategies and objectives to gain maximum value for all money spent for all categories of procurement and contracting.

The Core Competencies

Supplier Pricing Models
Supply Management Mission and Vision
Cost Analysis
Use of Price Indexes
Price Analysis
Preparation for Negotiation
Strategic Approaches in Supply Management
Developing what the Price Should be
Spend Analysis
Price/Volume Analysis
Value Analysis
Total Cost of Ownership

The Programme Content

Setting the Strategic Direction

Defining the Supply Management Mission and Vision
Stages to World Class Supply Management
Change and Becoming More Strategic
Supply Management Skill Sets
Developing the Spend Analysis
Creating Time to be Strategic
The ABC (Pareto) Analysis
Material/Services Purchasing Code Development

How Do You Know That you Obtained a Good Price

Supplier Pricing Models
Defining Cost and Price Analysis
Difference Between Cost and Price Analysis
Selection Tool
Methods of Price Analysis
Historical Analysis
Working with Producer Price Indexes
Developing the Organization’s Purchase Price Index
Estimating Cost Relationships

Getting a Better Price by Analyzing Cost

Methods of Cost Analysis
Major Elements of Cost
What and How Important Are Supplier Overheads
Sources of Cost Information
Developing “Should Costs”
Requesting Supplier Cost Info
Issues In Analyzing Supplier Cost Breakdown

Using Price Volume, International Labor, and Value Analysis

Global Industrial Labor Rates
Working With Currency Exchange Rates
Cost Volume Profit Analysis
Fixed and Variable Costs Defined
Use of Cost Volume Relationships
Calculating Fixed and Variable Cost Algebraically
Defining Value Analysis?
The Test for Value List
The Supplier Value Check List

Total Cost of Ownership (TCO) Concepts

Change in Supply Management
Definitions of TCO
Objectives of TCO
Barriers to TCO
Process Flow Diagrams
Approaches to TCO
Dollar Model
Value Model
Total Cost Modeling of the Supply Chain
Implementing TCO

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