Survey

In spite of high inflation some cost savings were obtained. How much net cost changes in the last 6-12 months did you obtain over or under the budget?

More than 10% under.
1 to 10% under.
No change.
1% to 5% over,
6% or more over.

Now is the time to get ready for the new year. Planning what you want and intend to do early will insure..." />

Be Prepared for 2013

Date: 11/01/2012

Now is the time to get ready for the new year. Planning what you want and intend to do early will insure that you benefit for the full year. A well-run organization will develop objectives first. Then budgets will be made to help achieve those objectives considering projected forecasts about the economy.

Division and then department objectives should be based on the top level objectives. Individual objectives should be based in part on the department objectives as well as an individual’s goals.

The objectives of the purchasing function may include revising policies or procedures as well as establishing new ones.

The purchasing department objective may include training for buyers or other purchasing personnel. The purchasing manager should make sure that there is an established budget for such training. For example, projected expenses for seminar costs should be included.

A headcount budget must consider how many buyers or purchasing clerks will be needed based on the forecasted volume. The budget is a plan. Actual events may turn out differently in which case a change in headcount may not be implemented.

A change in the number of buyers is not the only reason for adding personnel. Adding a purchase analyst or a person to do purchasing research may produce significant cost savings.

Now is the time to negotiate long-term contracts, lower prices, and blanket orders for the new year. Sales departments are accustomed to such discussions. This is the time of year that they begin considering price increases. Smart buyers are ready by preparing facts and figures to counter supplier requests.

Now is the time for purchasing managers to evaluate their staffs and recommend salary increases or bonuses. The purchasing manager should be prepared to report the year’s achievements and plans for the coming year. This will give a higher level executive the information to base the amount of the manager’s bonus or a higher salary.