Logistics Cost Analysis And Control Of China Petroleum Pipeline Material & Equipment Corporation

The idea of modem logistics has been introduced to China for over 20 years. Nevertheless, there are some weak Points in logistics management, especially of enterprises, for logistics covers a wide range of aspects as accounting of cost, making an inventory of all the stock, the establishment of modem information system, and so on. As one of main basic industry of the national economy, with the rapid development of petroleum pipeline construction of China, the logistics management has been attached to more and more importance by managers. As present, due to the inefficiency, the outmoded logistics management techniques and methods and the high logistics cost of most logistics corporation, seeking for a stronger management has been an urgent task.The China petroleum pipeline material & equipment corporation (abbreviated as CPPMEC) is a professional logistic corporation affiliated with the China petroleum pipeline bureau. Despite such tremendous productive force, there are still some problems with the current logistics cost management and the accounting system, such as high logistics cost, inaccurate information of logistics cost, irrational institutional framework of logistics, unsmooth internal logistics and outmoded information system of logistics cost management. This paper aims to make an analysis and research of logistics cost management in CPPMEC, to probe into the effective measures to lower the logistics cost and to improve its efficiency in accounting and management of logistics cost as well as its performance by the rational design and application of activity-based costing.This paper makes a thorough analysis of the current situation of logistics cost management of CPPMEC. With the methods of qualitative analysis, quantitative analysis, comparative analysis and demonstration analysis, this paper carries out a detailed analysis of CPPMEC's problems and their causes, and then puts forward the specific measures to lower the logistics cost and strengthen logistics cost management. These measures include establishing a intact stock system, improving logistics transportation management, increasing the turnover rate of materials and equipments, improving the mechanism for inspiring the employees, improving the informational and network establishment of logistics cost management. The last section in this paper assesses the prospect for the application of activity-based costing to CPPMEC.