Research On Purchasing Cost Management Of HB Company

In recent years, China’s auto consumption is still in the stage of rapid expansion, although there is added some of restrictions on car in the first and second -tier cities, it can’t stop the rigid demand on the car. The rigid demand is transferred from the first-tier cities to the third and fourth tier cities, China’s per capita car ownership is still far below the world average comparing to Europe, Japan and other developed countries. The rapid rise of China’s auto market, which brings good opportunities for a large number of auto parts enterprises to develop, which also brings a great challenge. "Globalization" and "global village" to make narrow the distance between the countries, but also brings countries companies into competition platform. How it can keep enterprise to conduct business in a fully competitive market in the long-term; it is the most important to improving procurement cost management,reduce overall procurement costs and improve the competitiveness of China’s auto parts enterprises.HB company procurement cost management and unscientific notion is not scientific by constructing cost management optimization model and field survey, which purchase cost management is only responsible by the purchasing department, other function department ignore purchase when they want to changes some orders. For example, product development department just consider the product design, it is not considered to use the cheaper substitute materials which is not affect product’s function; Components interoperability is poor when new product development, which cause a lot of slack when the product replacement; It does not recognize 60-70% of product cost is decided in product design within manufacturing;lowering costs is the price, the costs charge to suppliers to achieve lower costs. Supplier management is not scientific, not really from the amount, price aspects of the control suppliers.By Target Costing to help auto parts enterprises to improve procurement cost management, through chart analysis explores target costing of HB company to improve the implementation of the path cost management, through analysis of information on the company to find solutions to their specific application methods. Finally concludes the paper, and put forward the idea of future studies and further research directions.