Purchasing Techniques, Negotiating and Cost Reduction
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Purchasing Techniques, Negotiating and Cost Reduction Course
Introduction:
This course focuses on analyzing an organization's expenditure on goods and services, ranging from raw materials to stocks and spares. To enhance profitability through cost reduction, top-tier organizations prioritize their purchasing strategies. The key to successful purchasing lies not only in identifying potential opportunities but also in implementing effective methods, processes, and techniques. This course emphasizes becoming a leader in achieving tangible savings in supply management through skilled negotiations and a comprehensive understanding of cost reduction strategies.
Course Objectives:
Define the strategic role of the purchasing department. Perform accurate supplier evaluation. Identify the importance of value analysis to purchasing. Evaluate the performance of the department using proper Key Performance Indicators (KPIs). Improve the efficiency of the purchasing function.
- Examine the key features in spend profiles
- Evaluating costing reduction opportunities
- Understanding supplier pricing structures
- Apply to purchasing strategic plans
- Develop common approaches in planning for negotiations
Who Should Attend?
Senior buyers, purchasing supervisors, purchasing managers, and other managers who need to understand purchasing management.
Course Outlines:
Continuous Improvement in Cost and Productivity
- How do other functions view purchasing
- A Purchasing Savings Model
- Total Cost of Ownership Models
- Cost Reduction Initiatives
- Establishing a Strategic Focus with Pareto Analysis on Cost
- Modern Methods of Analyzing the Spend
Defining Cost Reduction Opportunities
- Developing Company Purchase Price Index and Comparing to External Indexes
- Understanding of Supply Marketplace and how Suppliers Price
- Benchmarking best practices in Cost Reduction
- Resisting Price Increases
- Supplier Performance Measurement
- Cost Saving Methods
Methods of Price Evaluation
- Price Justification
- Methods of Price Analysis
- The Competition that leads to price reduction and evaluation
- Methods of Cost Analysis
- Breaking down the Elements of Cost
- Developing "Should Cost"
Successful Negotiations
- Negotiation Skill Sets
- Steps in Negotiation Preparation
- Methods of Persuasion
- What Does Win/Win Really Mean?
- Determining the Issues
- Rating & Valuing Issues
Determining Strengths and Weaknesses
- Know Your Better Alternatives to Negotiated Agreements (BATNA)
- Analyzing The Other Side
- Negotiation Objectives Diagram
- Prepare the Negotiation Team
- Tips for the Actual Negotiation
- Participants will negotiate model cases & discuss the results to provide an opportunity for hands on experience