Strategic Purchase Of Raw And Auxiliary Materials In T Company

At the beginning of21thcentury, the iron and steel industry in China hasdeveloped rapidly. Driven by the high profits, enterprises started to expand the scale,which results in the excessive capacity. Especially, since the financial crisis, the ironand steel industry has entered into its downturn period and this kind of situation maylast for a long time. In the context of excessive capacity, this paper, based on a plentyof literature, makes a study on the theories of strategic purchasing and supply chainmanagement, clearly defining the strategic purchasing and discussing the importanceand the key point of management. The present study puts focus on the design ofsupplier group work, the development of long supply-and-demand relations,self-production and outsourcing, and purchasing integration.Although the academia and business communities haven’t reached a consensus,the strategic purchasing is undeniablely the developing direction in the area ofpurchasing. The strategic purchasing is a part of business development, which candefinitely bring some new energy into the business. Therefore, it should be paid highattention by the leaders and managers in business.T Company is the internationally known and the largest seamless steel pipemanufacture in China, and is the core subsidiary of TT Group Corporation. This papertakes the raw material purchasing of T Company. as the research subject. Around thedevelopment strategy of T Company,it first analyzes the current situation of raw andauxiliary materials purchasing and then the quality of raw and auxiliary materials.Then, in the process of analysis, this study uses the supply positioning model and putsforward the model of material consumption and productivity. Based on the aboveanalysis, this paper gives the purchasing strategies of T Company from the aspects ofdesign of supplier group work, the development of long supply-and-demand relations,self-production and outsourcing, and purchasing integration. Finally, the studydiscusses the strategic purchasing supports from the design of purchasing keyindicator, the support of information system and the adaptation of organizationstructure and put forward the specific scheme.