Contemporary Management

Suppliers Management

Group Members: Ahmed Sherif Yassin Ahmed Ezz Eldin Mostafa El Shazly Mostafa Sadek Mohamed Shaarawy

Suppliers Management In definition supplier management is the methods and process of strategic institutional or corporate buying, this could be the purchasing of goods for a company for internal use, raw material for production.
in many organizations, acquisition or buying of services is called contracting, while that of goods is called purchasing or procurement The supply management function of an organization is responsible for various aspects of these acquisitions such seen in this basic diagram.

1) Supplier sourcing Supplier sourcing is basically the screening of the suppliers according to my needs and strategic plans, basically answering the question which supplier can meet my needs for this period. Should I choose the supplier, which will offer me high quality or lower cost & specific delivery time? How many suppliers can give me the required materials/services? Can all of the suppliers give our company our needs at the same time, price and quality? Can we change our supplier easy? Such question arises in the sourcing phase, basically trying to match my needs with the appropriate supplier.

2) Supplier Qualifications & Reputation: Supplier qualifications are very important, in the sense that is he related to my industry or not, will he meet my exact specification of the servicematerials or goods that I ask of him or not. Does the supplier have previous experience supplying the materials before to similar industries? These two points are very important to accept or reject the supplier offer, because the reputation of the supplier is very important and it will be good indicator that he will commit in his deals or not and the size of his firm and qualifications will show that he could provide my needs in time. Based on The qualification and reputation, we start to have an idea of which suppliers we can deal with and can he provide us as a company with the exact specifications we require or not.

3) Supply Management.

in this criteria we have a lot of aspects to cover such as : A) Cost: is the supplier cost reasonable and competitive to the market prices or not, and weather he provides facilities to my company, such as suppliers credit or not? B) Quality: suppliers with high quality products are much preferable for reliability and performance issues, the supplier with high quality are much preferable relative to cost level. C) Time & Reliability: whether the supplier can deliver the contracted services or goods at time or not , if the supplier is not meeting his delivery timelines or not. Any delays could cost the company a lot of money and at the same time lose a lot of its customer if the products are not delivered in the agreed upon time. D) Inventory Management: Managers should strategically plan their inventory management and consumption according to the needs of the company, so they dont have any disrupts in the supply chain, this means everything should be planned according to production needs and to future consumption estimates. E) Just in Time approach: is a production strategy that strives to improve a business return on investment by reducing in-process inventory and associated carrying costs. In simpler terms, just in time approach is a brilliant idea to save cost of storing inventory and carrying cost in which both the firm and supplier have the capability of implanting this strategy.

F) Logistics: is that part of the supply chain which plans, implements and controls the efficient, effective forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customer and legal requirements.

Logistics management is known by many names, the most common are as follows: Materials Management Channel Management Distribution (or Physical Distribution) or Supply Chain Management. Actually the logistic is one of important factor which affect in dealing with vendors if the destination from the vendor and the firm is so far that will incurred the firm higher price of transportation and vice versa if the goods are related to food or beverage the special transportation are required for this goods which needs to certain temperature to save it so the destination and logistic can make the firm rely on one supplier than another.

4) Supplier Evaluation What I'll do as a manager if the supplier didn't supply me with the material in time, which will result in me being late in fulfilling my customer's orders & so losing them? As a manager I should be prepared for this anytime either by always

having a stock to produce for some time until I can find another alternative, or I can buy the materials from another supplier immediately for relatively higher price because fulfilling my orders with customers is my priority, I may lose some money but not my reputation. If the supplier succeeded in fulfilling the contracts on time and with the agreed on quality and price then I should continue working with him if not then I must go through step 1 and 2 again to screen and examine more suppliers. 5) Suppliers diversity and competitors (supplier risk). As a supply manager I must not rely on one supplier to fulfill my needs of certain materials or good, I must have a pool of suppliers in different countries to eliminate any possible supplier risk. I must examine if the supplier is dealing with any competitors I have or not, this is a very crucial point so we eliminate any corporate espionage and eliminate any information leaks, this is very important in the tech industry, pharma and many others that rely on competitive edge. There are many type of risks in the supply management by using the diversity approach it helps to minimize and hedge that kind of risk.