1. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 1 Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations

2. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 2 Commercial Enterprises –Manufactures –Construction –Service firms –Transportation –Professional –Resellers Includes

3. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 3 Manufacturers & Size Approximately 360,000 in the U.S. There are 10% or 36,000 that employee more than 100 workers. The 10%, ship 75% of all products manufactured in the U.S. Typically serves far fewer but far larger customers. 服務對象少，但受到服務的顧客卻很多。

4. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 4 Manufacturers & Geographics Half are located in eight states Important implications: –First, can concentrate marketing efforts 集中市場焦點 –Second, with distribution centers in large volume areas rapid delivery is possible 物流中心能快速處理這些地區的大量貨物 –Third, sales personnel may not be tied to specific geographic areas 銷售人員較為輕鬆

5. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 5 Classifying Commercial Enterprises  NAICS organizes business activity into economic sectors and identifies groups of business firms that use similar production processes.  Result of NAFTA.( 北美自由貿易協定 )  Replaces SIC ( 標準產業分類 ) system. Source: Reprinted from Michael R. Czinkota, et al, Marketing, Best Practices (Fort Worth, TX: The Dryden Press, 2000), p. 183. North American Industrial Classification System

6. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 6 Purchasing Function Goals To address the needs of business customers of all types. May have to juggle a number of different objectives that clash. The Goals of Purchasing

7. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 7 Total Cost Considerations of a Product or Service Factors that drive total cost. Acquiring and managing costs. Quality, reliability over the life cycle. The value a firm/ customers.

8. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 8 Firms operate at different levels of development and emphasize different pathways to cost reduction and revenue enhancement. Levels of Procurement Development and Pathways to Savings/Revenue Enhancement

9. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 9 Segmenting Purchase Categories 1 st Point, each firm has a unique portfolio. 2 nd Point, more attention on purchases having the greatest impact on revenue generation or the greatest risk to performance. Segmenting the Buy

10. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 10 Procurement Complexity Considerations  Technical complexity. 技術複雜程度  Scope of supply chain coordination required. 所需的供應鏈協調程度  Degree to which life cycle costs are relevant. 在生命週期中攸關成本的程度

11. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 11 Purchasing Managers & Performance The buying organization weights each performance factor. Organization assigns relative importance to performance factors. Is more objective and flexible than the categorical method. The Weighted –Point Plan

12. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 12 Two Types of Contracts 1.Fixed-price contracts 固定價格契約 A price is agreed to before contract is awarded and payment is made at conclusion of work. Provides for the greatest profit potential. Poses greater risks. 2.Cost-reimbursement contracts 成本退還契約 Reimbursement for allowable costs may be allowed and sometimes a number of dollars above costs as profit is allowed.

13. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 13 Government Procurement 1.Defense-said to be the largest enterprise in the world (DOD). 2.Nondefense-procurement is administered by world wide variety of agencies.

14. Copyright © 2004 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Developed by Cool Pictures and MultiMedia Presentations 14 Two Procurement Strategies 1.Formal Advertising—the government solicits bids from suppliers, and usually the lowest bidder is awarded the contract. 2.Negotiated Contract—used to purchase products or services that are not differentiated on price alone, competition is common.