Procurement Management Of Small Organizations
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Introduction
This is the first assignment of the course procurement management. In this assignment our group is going to collect information about 3 small companies in Shanghai and analyze compare their management situations problems in purchasing and current risks.
Comparative Profiles of the Organizations
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Brief description of business and supply chain position identification:
A: JinShanCheng restaurant in Songjiang university town along Wenhui road. It is a restaurant mainly serving the authentic Sichuan food and providing fast lunch. This restaurant has about 100seats with 8 big round tables and 12 small tables. It can serve about 100 people to have dinner at the same time. 7 cooks and 6 waitresses are employed there. Their target customer are SIFT students and students in Donghua University. It only has one supplier for fresh vegetables and one for raw meat, 2 suppliers for kinds of fish and one supplier for special condiments in Sichuan province.
B: Tianli book store: It is a small bookstore selling over 600 kinds of books on various aspects for different knowledge branch ranging from Science and Engineering to business management and economics. Many reference books for various certificate examination and popular fiction can be also found there. It provides the students with strong support for learning activities including the services of printing and duplicating. There are 60 square meters with 3 book shelves and one duplicating machine and 2 printers. It mainly serve the students in SIFT and Donghua university.
C: Zhao xiang vehicle fitting cooperation. It is a second tier wholesaler of various kinds of filling parts including spark plug, second tier wholesaler of pump and shock absorber, and the distributor of engine piston. It is a small organization with registered capital of 500thounsand RMB.
Organization
Products
Position in SC
Supplier
Target market/customer
JinShanCheng Restaurant
Fresh vegetables
Manufacturer
Yixiang vegetable wholesaler
Students in Songjiang university town, especially SIFT student
Raw meat
Manufacturer
Tablecloth washing
Customer
Laundry in university town
TianLi
Bookstore
Economics& finance
Retailer
Wholesaler
in Minhang
Students in Songjiang university town, especially SIFT student
Business management
Science& engineering
Wholesaler in Songjiang
Popular novels
One supplier in Hangzhou
ZhaoXiang
Automobile fitting
Cooperation
Shock absorber
First tier wholesaler
Ruian Yaxing automobile fitting factory
Automobile repair factory or
Automobile assembly plant
Engine piston
Second tier wholesaler
Beijing Puran wholesale agency for Federal mogul
Spark plug
Manufacturer
TianLi book store is a typical retailer in supply chain. It has 4 suppliers, 2 of them are located in Shanghai Minhang district. They are the major supplier for books in economics, finance and business management. And this book store purchase popular novels and books from a book wholesaler in Hangzhou.
Similar to TianLi bookstore, the restaurant also plays a retailer role in its supply chain for its beverage and alcohol. But for the dishes, the restaurant can be also considered as a manufacturer. They purchase fresh vegetables, meat and special condiments to prepare for authentic Sichuan food. It also sources some activity such as washing tablecloth to a laundry nearby.
The automobile fittings cooperation plays various roles in supply chain for different products. For shock absorber, it is the first tier wholesaler in its supply chain. They mainly purchase shock absorber from Ruian Yaxing Company who is a big manufacturer for automobile fittings. And several other manufacturers have also developed business with them. They’ve developed long-term relationships with their suppliers.
Engine pistons are mainly purchased from Beijing Puran Trade Company, which is the wholesale agency for federal mogul’s engine pistons. And ZhaoXiang also has a small plant producing spark plugs for the automobile repair factories in Shanghai.
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The phases of purchase process:
Identify user need for products or services.
A: The purchasing process begins with identifying or anticipating a materials or services needed by a user.
JinShanCheng restaurant purchases raw materials such as meats and fresh vegetables. The internal users of the restaurant are these cooks, and they transmit their needs by word-of-mouth to the employer.
Sometimes, a service is required and purchased. The waitress may want to have these tablecloth cleaned. They will communicate with their employer about how many sets of porcelain dinner sevices and pieces of tablecloth needed to be cleaned. All these should be approved by their employer.
Organizations
Users
Method used to identify needs
The way to communicate
Restaurant
Cooks and waitress
Direct stock checks
By word-of-mouth
Bookstore
Students
Market demand forecast for newly published books
Computer-generated method
Automated notification of depletion
ZhaoXiang
Automobile fitting
Cooperation
Sales person
Reorder point system for repetitive goods
Computer-generated method
B: The bookstore will identify the need for books by monitoring their reserves. An information system is applied in bookstore to identify which book should be purchased. When the quantity of a certain type of book is depleted to a certain level, the system will notify them and they will determine whether to issue a request for replenishment. Beside these routine items, they also have to know which book newly published tend to be popular in