ABSTRACT
All organizations purchase something. Purchasing is one of the most important functions in an organization, because purchased goods represent a high percentage of total costs in a company. It may be 80%–90% in some retail or distribution operations and is probably at least 50% in most manufacturing companies. Even hospitals have high and critical purchasing requirements. Only high-value service operations, such as law firms, public accountants, and consulting firms, have low purchase costs. As you read this company profile and the chapter in the book, think about these questions:
• How has the purchasing function changed over the last few decades? • Does purchasing have a role in product design? Explain.
