P2 p direct materials strategy

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P2P DIRECT MATERIALS

BY PARISH PATHRABE

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Direct materials is the materials which

describe in BOM (Bill of materials) For example RM, transportation cost & salary Indirect materials is the materials which we

consume and take help of them but not describe in BOM

For example tools,machinary & equipment

Meaning

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Classification

Procurement

Fixed Expenses

Salary Depreciation

Variable Expenses

Direct Materials

Direct Labour (Pay as per

hours)Transportation Materials

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Y=mx+c

Where, Y=output mx=variable expenses c=fixed expenses

Equation

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In short period(time zone) , fixed expenses are

fixed & variable expenses are variable. But in long period (time zone), all (Fixed

+Variable) expenses are variable . So you can control your expense in long run

process

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Vision (long term goal) Mission (short term goal) Code of conduct Core value- it include transparancy policy,gift

policy

Every company have

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Employees Suppliers Customers Shareholders Society

Stackholder

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Every good company focus or attack on triple bottom profit line Economic profit Societal profit Environment profit In short, we can say that People(Society), Planet

(Environment) & Profit(Economic)

Bottom line

if all profits are in green,then we consider as good business

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Vision Quality & reliabilty Product appeal & styling Customers satisfaction Lowest ownership cost Relevant cost with effective technology More content at a price pointMission Love the product

Strategy

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All strategic model must meet the vision &

mission Covering all touch points of customers

expectation Network Sales Products

Strategic objective & goal

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Ability to innovate Contemporary styling Technology

Core competencies(Value)

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Market share Top players Competitors Product & their price Brand image/Customer satifaction/ServiceAlso focus on current market position, Young players Sales % of other including domestic also

Know about the market

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Segment gap Expand production Improve penetration through network Satisfaction score New market which increase your market share Employee engagement (Belongingness)NOTE: Organic growth: By build new plant or new warehouse Inorganic growth: By merging or acquire

Focus on

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Financial prospective Customers/ Market prospective HR prospective Business prospective -Quality

-Vendor rating-Capacity-Product introduction

Also focus on

All are internally connected

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Acquisition of cutting edge technology through JV,

technology agreement, merger acquisition Vendor selection based on strong technology &

management Limited vendor is good for the company Vendor practice & their benchmark Develop healthy vendor base to support

Sourcing strategy

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Purchase in bucket manner Complexity is high ,suppliers are more

Important terms: CKD - Completely Knock Down SKD – Semi-complete Knock Down SKU – Stock Keeping Unit

Global purchasing strategy

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Purchasing from the productcomponent with best

quantity Develop advance technology is competative

advantage Low cost of production Economic scale and update technology

Technology

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For any query ,parishpathrabe14@gmail.com

Thank You