Tag: Cost Optimization

cost drivers

Should-Cost Analysis in Procurement: Complete Guide

A supplier’s quoted price tells procurement what the supplier wants to charge. It does not necessarily explain what the product or service should reasonably cost. This is where should-cost analysis becomes valuable. Should-cost analysis is a structured procurement method used to estimate the reasonable cost of a product, component, service or process by examining its

Capacity Planning

Make-or-Buy Analysis in Procurement: Cost, Strategy & Decision Guide

Make-or-buy analysis is a strategic procurement decision used to determine whether an organization should produce a product, component or service internally or purchase it from an external supplier. The decision is more complex than comparing internal production cost with a supplier quotation. A proper make-or-buy analysis considers: Cost + Capacity + Quality + Capability +

Cost Optimization

Supplier Performance Management: Process, KPIs, Scorecards & Best Practices

A supplier may offer a competitive price, but that alone does not make the supplier successful. Procurement performance depends on what happens after the supplier is selected. Does the supplier deliver on time? Does the material meet quality requirements? Are costs competitive? Does the supplier respond quickly to problems? Can the supplier support increasing demand?

Cost Optimization

Procurement Objectives: 10 Key Goals Every Procurement Team Should Achieve

What is the main objective of procurement? If the answer is simply “buy products at the lowest price,” procurement is being viewed too narrowly. Modern procurement has a much broader responsibility. A procurement team must help the organization obtain the right product or service, at the right quality, from the right supplier, at the right