Purchasing, Inventory, and Purchasing, Inventory, and Quality ControlQuality Control

PurchasingPurchasing

What is it?What is it? TypesTypes

RetailingRetailing Manufacturing plantManufacturing plant GovernmentGovernment

Federal Acquisition Streamlining ActFederal Acquisition Streamlining Act

PurchasingPurchasing

Why is it important?Why is it important? Just-in-time inventoryJust-in-time inventory

Trends/ ProblemsTrends/ Problems Supplier-base downsizingSupplier-base downsizing Fully-integrated production networksFully-integrated production networks Not having right stock availableNot having right stock available

PurchasingPurchasing

One person in controlOne person in control Why?Why?

SituationsSituations Expected change in priceExpected change in price Expected change in demandExpected change in demand Orders for specialty goodsOrders for specialty goods Short supply of materialsShort supply of materials

PurchasingPurchasing

Choosing the Right SupplierChoosing the Right Supplier What to look forWhat to look for Where to lookWhere to look Single supplier o multiple supplier?Single supplier o multiple supplier?

Investigating Potential SupplierInvestigating Potential Supplier Evaluating SuppliersEvaluating Suppliers

PurchasingPurchasing

Establishing an Effective Purchasing Establishing an Effective Purchasing ProcedureProcedure Requisitioning Goods or ServicesRequisitioning Goods or Services

TriggersTriggers RetailingRetailing

Making and Planning Purchase OrdersMaking and Planning Purchase Orders Purchase ordersPurchase orders Standing ordersStanding orders

PurchasingPurchasing

Establishing an Effective Purchasing Establishing an Effective Purchasing ProcedureProcedure Paying Satisfactory PricePaying Satisfactory Price Receiving itemsReceiving items

Role of ComputersRole of Computers

InventoryInventory

““The property owned by a business or the The property owned by a business or the property so listed.”property so listed.”

Role of InventoryRole of Inventory Types of InventoryTypes of Inventory

Finished items on display for saleFinished items on display for sale Batches of goodsBatches of goods Repair parts awaiting useRepair parts awaiting use Supplies for use in office, store, or shopsSupplies for use in office, store, or shops MiscellaneousMiscellaneous

InventoryInventory

80-20 rule80-20 rule ImplicationsImplications

Cost of Carrying InventoryCost of Carrying Inventory Determining When to Place an OrderDetermining When to Place an Order

Costs of orderingCosts of ordering Lead timeLead time

Determining How Much to OrderDetermining How Much to Order Economic Order QuantityEconomic Order Quantity

Balance cost of placing an order with inventory-Balance cost of placing an order with inventory-carrying costscarrying costs

Operations Planning and Operations Planning and ControlControl

Variations in DemandVariations in Demand CausesCauses How to DealHow to Deal

Allow operations to rise and fallAllow operations to rise and fall Build-up inventory to level outBuild-up inventory to level out Carry complementary productsCarry complementary products Do not expand facilities- just lose salesDo not expand facilities- just lose sales

Scheduling OperationsScheduling Operations Controlling OperationsControlling Operations

Quality & ControlQuality & Control

Growing importanceGrowing importance What is quality?What is quality? Improving and Controlling QualityImproving and Controlling Quality

Establishing quality circlesEstablishing quality circles Designing quality into the processDesigning quality into the process Installing a quality control systemInstalling a quality control system

W. Edwards DemingW. Edwards Deming

Quality & ControlQuality & Control

Installing a quality control systemInstalling a quality control system Set standards for the desired quality rangeSet standards for the desired quality range Measure actual performanceMeasure actual performance Comparing their performance with Comparing their performance with

established standardsestablished standards Make corrections when neededMake corrections when needed

Who can measure quality?Who can measure quality? International Organization for International Organization for

StandardizationStandardization