The total volume of purchased goods and services within companies frequently accounts to more than 60 % to 70 % of the total costs and is therefore the most important leverage for increased earnings.
Purchasing – more than just material costs
This not only relates to “material costs” but also to all other expenses which are often not processed with the appropriate intensity in many businesses .
The price achieved for a product or a service is the outcome of various complex circumstances and factors: quality, quantity, delivery dates, negotiation skills, strategic premises of the buyer or seller, previous or subsequent market developments, legal regulations and numerous other issues. Identifying potential cost reductions in connection with the aforesaid complex circumstances is the main objective of purchasing optimization.
The starting point of the analysis is the personal and structural power and efficiency of all departments involved in the buying process, including the assessment of mastering the “Interplay of all factors influencing the price within the company.