Purchasing Techniques, Negotiating & Cost Reduction

In today’s business world, reducing costs is critical to the success and survival of any organization. A sound purchasing strategy, combined with effective negotiation skills, can significantly impact a company’s bottom line. This 3-day course on Purchasing Techniques, Negotiating & Cost Reduction provides participants with the knowledge and tools to achieve cost reductions and improve their purchasing processes.

The course covers various aspects of cost reduction, including data mining and developing strategic plans, methods of cost improvement, purchase price index development, cost improvement reporting, cost reduction vs. cost avoidance, supplier evaluation, low-value activity reduction, best practices in supplier qualification, and the importance of planning in successful negotiations. Participants will also learn how to rate and value the issues in a negotiation, and negotiate important contract clauses. With a focus on practical application, this course will provide participants with the skills and knowledge necessary to implement cost reduction initiatives and improve their purchasing processes.

Key Learning Points:

• Develop a comprehensive understanding of cost reduction strategies and techniques.
• Enhance skills in data mining and creating effective strategic plans for purchasing.
• Recognize various methods for improving costs and understand the process of developing a purchase price index.
• Learn how to report cost improvements and differentiate between cost reduction and cost avoidance.
• Acquire knowledge in evaluating supplier prices and reducing low-value activities.
• Master the best practices in qualifying suppliers to ensure cost-effective purchases.
• Understand the significance of planning in successful negotiations and be able to rate and value issues during a negotiation.
• Negotiate effectively on crucial contract clauses and make informed decisions to reduce costs.

Course Content

Overview

Introduction to Purchasing Techniques and Cost Reduction

• Overview of cost reduction and its importance in modern businesses
• Understanding the process of data mining and developing strategic plans for cost reduction

Methods of Cost Improvement

• Overview of the various methods of cost improvement
• Understanding the process for developing a purchase price index
• The procedure for reporting cost improvements

Cost Reduction vs. Cost Avoidance

• Understanding the difference between cost reduction and cost avoidance
• Evaluating supplier prices and reducing low-value activities

Qualifying Suppliers

• Best practices in qualifying suppliers
• Importance of supplier selection in cost reduction

Planning for Successful Negotiations

• Understanding the importance of planning in successful negotiations
• The role of research and preparation in negotiations

Rating and Valuing Issues in a Negotiation

• Importance of rating and valuing the issues in a negotiation
• Understanding the bargaining power of the parties involved

Negotiating Contract Clauses

• Overview of important contract clauses
• Understanding the negotiation process for various contract clauses
• Techniques for successful negotiations

Wrapping Up

• Recap of key takeaways from the course
• Next steps for implementing cost reduction and negotiation techniques in the workplace

Training Method

The programme will be a blend of interactive lectures, group discussions, and practical exercises. The lectures will provide the participants with a comprehensive understanding of the key concepts of cost reduction and purchasing techniques. The group discussions will allow the participants to share their own experiences, ask questions, and learn from each other.

The practical exercises will give the participants the opportunity to apply what they have learned to real-life scenarios. This will help them to understand how the concepts and techniques can be used in their own work environment. The exercises will be designed to be engaging and interactive, and will provide the participants with hands-on experience in negotiating and evaluating supplier prices, reducing low-value activities, and developing purchase price indices. The trainers will be available to provide guidance and feedback throughout the exercises, ensuring that the participants are able to maximize their learning experience.

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