Purchasing Management

A well-defined procurement organization structure is essential for businesses to optimize purchasing, reduce costs, and enhance operational efficiency. The structure determines how procurement activities are managed, ensuring alignment with overall business objectives. In this article, we will explore different procurement organization structures, their benefits, and best practices for selecting the right one for your business.

Strategic purchasing is most often associated with external relations. However, purchasing integration and internal collaboration are the enablers of every corporate strategy. The aim of this chapter is to explain the connections between purchasing and the company's competitive priorities as well as emphasize the need for interdepartmental collaboration.

Sourcing Strategies of Purchasing Management

Sourcing is the activity of securing external components or services needed within the own internal organization. Companies employ different kinds of sourcing strategies and no one is declared to be the optimum solution. Outsourcing which is the foundation to choice of sourcing strategies also intends to align with a company's core competence focus.

The aim of this chapter is to provide the reader with an introduction to Purchasing Management in order to fully appreciate the book. The chapter presents the book's definition of Purchasing Management as well as briefly presenting the potential benefits with working at a strategic level with purchasing activities for a corporation.

Furthermore, trends and historical developments within the area of Purchasing Management will be presented.