Presentation on procurement

INPUT OUTPUT PROCESS (PROCUREMENT )

Delivered By:

ABDUL FAHIM

BEM/15505

COMPANY INTRODUCTION:

• INTRODUCTION• Nawan Laboratories (Pvt.) Ltd. Pakistan is a quality

conscious Human & Veterinary pharmaceutical manufacturer located in Karachi, Pakistan since 1994.

Nawan possesses the expertise, knowledge and technical know-how to produce and market pharmaceutical products. Under the modern manufacturing facility, our experienced and dedicated pharmacists, chemists, microbiologists, biotechnologists, biochemists & quality control assurance managers and other skilled personnel strictly control all processes & ensure quality outcome of the product.

HISTORYHISTORY• Emerging in 1994, with a limited range of health care products is now a W.H.O-G.M.P

certified pharmaceutical unit which has diversified its operations into Human Pharmaceuticals, Poultry Medicines, Livestock Medicines, and expanded its market to Middle east & African Countries, Nawan Laboratories (Pvt.) Ltd has come a long way in its development and progress.

•  Historical Highlights

• 1994• Construction of W.H.O-G.M.P Standard factory at Korangi Industrial Area Karachi -

Pakistan and earned certification to produce injections, Tablets, Capsules, Suspensions, Ampoules, Liquid, Powder, Bolus, Granules and Aerosol dosage forms.

• 2000• Started Veterinary Pharmaceutical export to Middle eastern, African and Far eastern

countries.• 2005• Started Human Pharmaceutical export to African and Far eastern countries.•  2009• Becoming one of the fastest growing Human and Veterinary Pharmaceutical company

in Pakistan.

A picture is better than 1000 words!!

- A supply chain consists of

Supplier Manufacturer Distributor Retailer Customer

Upstream

Downstream

Supply Chain Processes

Physical distributionPhysical supply(Materials management)

Business logistics

Sources ofsupply

Plants/operations Customers

• Transportation• Inventory maintenance• Order processing• Acquisition• Protective packaging• Warehousing• Materials handling• Information maintenance

• Transportation• Inventory maintenance• Order processing• Product scheduling• Protective packaging• Warehousing• Materials handling• Information maintenance

Internal supply chain

Traditional Scope of the Supply Chain

UNDERSTANDING PROCUREMENT AS A CONCEPT

InputSupplier

SCM(Procurement)

OutputQC/Production

SOP (Standard Operating Procedure)

• Procurement steps• Procurement life cycle in modern businesses usually

consists of 7 steps:

1. Identification of need:

2. Supplier Identification:

3. Supplier Communication:

4. Negotiation:

5. Purchase Orders:

6. Logistics Management: expediting, shipment, delivery

7. Payment:

Purchase Order Contents

1. Total Amount

2. Delivery Date and Terms

3. Payment Terms

4. Bank Guarantees

5. Currency Fluctuation or Exchange Rates

6. Packaging Terms

7. Inspection and Quality

8. Taxes

9. Insurance

10. Warranty Terms

11. Documentation

12. PO Acceptance

13. General Terms and Conditions

Letterhead PO#

Vendor Ref#

Quote Ref#

Order Date

Delivery Address

Vendor Selection

Vendor evaluation Critical decision Find potential vendors Determine the likelihood of them becoming

good suppliers Vendor Development

Training Establish policies and procedures

Vendor Selection

Negotiations

Cost-Based Price Model - supplier opens books to purchaser

Market-Based Price Model - price based on published, auction, or indexed price

Supply Chain Strategies

Negotiating with many suppliers Long-term partnering with few

suppliers Just In Time

SUGGESTIONS

Many Suppliers

Purchasing is typically based on price

Suppliers compete with one another

Supplier is responsible for technology, expertise, forecasting, cost, quality, and delivery

Few Suppliers

Buyer forms longer term relationships with fewer suppliers

Create value through economies of scale and learning curve improvements

Suppliers more willing to participate in JIT programs and contribute design and technological expertise

Cost of changing suppliers is huge impact

Just In Time (JIT)

“the right material, at the right time, at the right place, and in the exact amount”, without the safety net of inventory.

The philosophy of JIT is simple:

the storage of unused inventory is a waste of resources.

JIT inventory systems expose hidden cost of keeping inventory.

THANK YOU