Study On Purchasing Management Strategy For X Company

In the past10years more, the automotive parts industry has developedquickly, all large automotive parts companies in worldwide have set up theirplants in China, while at the same time, the local automotive parts companieshave also been growing dramatically. However, in the recent years, theincrease rate in automotive industry has been slow down and the competitionis more severe in the automotive industry. Some companies is starting to lookfor cost saving opportunities from the purchasing departments. This is thebackground why I’d like to start to study on the purchasing strategydiscussion for X company. I hope to get some knowledge and experiencethrough the purchasing strategy discussion study. Such knowledge andexperience can be cited for reference to the X company for cost saving..The thesis begins with the introduction of automotive industrydevelopment history in China. Secondly, it is the introduction on the development history of X company and its operation status in China; Thediscussion on the challenge of X company in China market will also behighlighted. Also, we will discuss the significance of this thesis for bothpractice and theory in X company. The thesis will be started with thepurchasing management strategy discussion in X company by the followingways:(1) Introduce X company’s purchasing structure, current purchasing status,purchasing process, suppliers status and the current challenge in thepurchasing department.(2) Analyze the purchasing part cost so as to find the main reasonregarding the high logistics cost, high stock level and the low rate ofsupplier’s on time delivery.(3) Analyze the current purchasing management strategy, optimize theoriginal sourcing clauses, refer to some theories and experience in theautomotive industry, and bring into the TPL.(4) Study the stock which is the main issue for X company. Utilize ABCmethod and refer XYZ method, reclassify those purchasing components toindentify the stock level for each component. Introduce VMI and EOQtheories to manage the components stock.(5) Summarize all chapters, in terms of validating the performance of purchasing management strategy optimization, follow-up for the furtherpurchasing management strategy suggestion.The thesis mainly focuses on how to improve X company’s purchasingstrategy, with the reference to some theories and experience in automotiveindustry, we can not only find out some good methods or solution to save alarge amount of cost for purchasing logistics for X company, but also inwhich way it can be cited for reference to the other companies’ purchasingmanagement in automotive industry.