The Strategic Research Of General Procurement For Carrier

Today, the competition in traditional industries, especially in manufacturing is very fierce. It is difficult for a company to win in such cruel competition, only depending on product, price and promotion, but the technology innovation and cost control. Procurement is the key of cost control, which brings the procurement department very important position in the company. Low-price procurement, stable quality and on-time delivery can bring the competitive advantage to a business. Traditionally, companies put more emphasis on raw material purchasing, but now they start to pay attention to non-production material purchasing, such as administration, marketing, parts, delivery, warranty, customs application, aftermarket, MRO, PPE, business conference, factory daily maintenance etc, because sometimes the expenditure on non-production material in a company is higher than the one on raw material, and cost saving should not only be contributed by raw material price cut, but also by every segment. The study on non-production material procurement wasn't found much either in China or other countries, so I intend to do an experimental study on this topic. The objective is to solve the problem occurred in the process of non-production material purchasing, such as the principle team building, the operation process, outsourcing strategy, cost control methods and team players' performance appraisal. Carrier is a global HVAC products manufacturer with annual revenue at more than US$10billion, it is also facing the fierce competition in China market. In order to retain its current competitiveness in this market, cost control is the point that Carrier must focus on.I made an analysis on procurement industry and Carrier China's situation, briefly described Carrier's procurement strategy, and had an analysis and study in details on Carrier's non-production material procurement strategy by using relevant theory of operation management. The problems and bewilderment existing in Carrier's non-production material purchasing was found through the financial analysis, and the solutions were introduced by specific cases. The objective of this article is to provide proposal solutions not only to Carrier on its procurement, especially on non-production material procurement, but also to other similar multinational companies as reference. The summary content of this article is (1) Introduction on the development of procurement industry and its trend ; (2) Non-production material procurement position in companies; (3) Carrier's situation analysis and competition strategy; (4) Carrier's procurement strategy ; (5) Carrier's non-production material procurement situation; (6) Problems faced by Carrier in non-production material procurement; (7) Case study and solutions...