Course Overview:

When the goal is to increase earnings by lowering costs, world-class organizations look closely at their purchasing strategies. Success in purchasing is dependent not only on an awareness of the potential opportunities, but more importantly, and the focus of this course, the knowledgeable implementation of the methods, processes, and techniques that should be utilized in order to become a leader in obtaining real supply management savings

Course Objectives

By the end of this training, participants will be able to:

• Learning key strategies for cost reductions
• Understanding the processes for data mining and developing strategic plans
• Understanding the methods of cost improvement
• Understanding the process for developing purchase price index
• Learning the Procedure for reporting cost improvements

Who should attend?

• Contracts, Purchasing, and Procurement personnel/managers
• Engineering, Operational, Project, and Maintenance personnel/managers
• All others who are involved in the planning, evaluation, preparation and management of purchasing, tenders, and contracts
• Those who are in organizations aiming to increase their level of competency

Course Content:

Day 1

• Price justification
• Model for selecting analysis methods
• Methods of price analysis
• Competition
• Historical prices
• How much profit is fair
• Methods of cost analysis
• Breaking down the elements of cost
• Developing “should cost”

Day 2

• User group brainstorming sessions
• Developing company purchase price index and comparing to external indexes
• Understanding of supply marketplace
• Process mapping to eliminate low value activities
• Developing purchasing material/services strategic plans
• Resisting price increases
• You will never be better than your suppliers
• Cost saving methods

Day 3

• How do other functions view purchasing
• A purchasing savings model
• Total cost of ownership models
• Continuous improvement skill sets
• Cost reduction initiatives
• Cost savings reporting procedure
• Data mining
• Establishing a strategic focus with the abc analysis
• Modern methods of analyzing the spend

Day 4

• Our responsibilities as agents
• Negotiation skill sets
• Steps in negotiation preparation
• Methods of persuasion
• What does win/win really mean?
• Determining the issues
• Defining issues
• Payment terms
• Progress payments

Day 5

• Evaluating your position
• Know your BATNA
• Analyzing the other side
• Negotiation objectives diagram
• Negotiations planning forms
• Prepare the negotiation team
• Tips for the actual negotiation