The Research Of Procurement Management About H Company Based On System Dynamics

Among the supply chain management,Purchasing connects the enterprise with suppliers of raw materials.Raw material cost is about 80% in the total operating costs.How to improve purchasing management activities,making it deepen into each step of operation and supply chain management,reducing the costs,and increasing the supply chain value in the process,is the key to be outstanding among the fierce competition.In order to optimize the purchasing decision and reduce the overall purchase cost,This article introduce H company’s organizational framework,process analysis of raw material procurement management,raw material procurement characteristics in the feed industry.Then based on the actual data of H company,With the help of mathematical equations to express and determine the system flow diagram in the state variables,rate variables and auxiliary variables,etc.,in order to establish the system dynamics model,and to explain the results of simulation,then put forward the existing problems in the Procurement process.Finally according to the system simulation results of the system structure and the elements of the relationship to be revised,by taking into account the safety of inventory and raw materials inventory,optimize procurement of raw material requirements plan,the use of economic bulk orders,optimize procure ment delivery plan,to find out the best solution to improve procurement decisions,so that the overall procurement costs of H company decreased significantly.In this paper,with the combination of theory and Practice,based on the system dynamics model,optimize the H company’s procurement decision-making,reduce the cost of procurement,give the specific procurement proposal.And provide reference for other feed enterprises in the procurement management activities.