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UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC BUSINESS MARKETING – CURRENT TOPICS IMPACTING ON SALES AND PURCHASES IN THE COMPANY. KNOWLEDGE FROM PRACTICE. MARKETING/INTERNATIONAL ECONOMICS – UCL – JANUARY, 2014 LECTURER MILAN ORESKY

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UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC. Business marketing – current topics impacting on sales and purchases in the company. Knowledge from practice . MARKETING/INTERNATIONAL ECONOMICS – UCL – JANUARY, 2014 LECTURER M ILAN ORESKY. - PowerPoint PPT Presentation

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Page 1: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

BUSINESS MARKETING – CURRENT TOPICS IMPACTING ON SALES AND PURCHASES IN THE

COMPANY. KNOWLEDGE FROM PRACTICE.

MARKETING/INTERNATIONAL ECONOMICS – UCL – JANUARY, 2014

LECTURER MILAN ORESKY

Page 2: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

BUSINESS MARKETING – CURRENT TOPICS IMPACTING ON SALE AND PURCHASES IN THE COMPANY

1. Intercompany relations and purchasing policy. Supply chains and networks.

2. E-SCM and E-procurement, E-reverse auctions

3. Customer relationship management – Supplier relationship management

Page 3: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

4. New product development and ESI – early supplier involvement

5. Selling and buying at right price. Tendering

6. Contract negotiations

7. Capital investment purchases

Page 4: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

1. Inter company relations and purchasing policy

Supply chains and networks

Page 5: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Page 6: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Logistics and Supply ChainsA Supply Chain is that network of organisations that are involved,

through upstream and downstream linkages, in the different processesand activities that produce value in the form of products and services

in the hands of the ultimate customer or consumer.

Can be classified according to:• Customer/supplier characteristics – concentrated, batch, retail

and distribution• Virtuality - information• Scope – international, regional, • Service• Complexity – direct, extended, ultimate• Products – end product (build to forecast, build to order)• Purpose and value

Types of Supply Chain

Page 7: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Supply Chain Management– Eight Processes

Customerrelationship

management

Product development& commercialisation

Supplier relationshipmanagement Manufacturing flow

management

Orderfulfillment

Demand management

Customer servicemanagement

Returnsmanagement

Quality of products and services

Balancing requirements with capabilities.... active influencing demand

Operations management, Quick response manufacturing

Company interaction with suppliers, short-term, long-term - intensity

Reverse logistics

Page 8: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Logistics and Supply Chains

Diversification – multiple sourcingStockpiling – inventory as a buffer

Redundancy – maintaining excess production, storage... Insurance – against losses

Supplier selection – more careful assessment of suppliers

Localised sourcing – shortening transport distancesRationalisation of the product range

Collaborative initiatives – spreading risksContractual obligation – imposing legal obligations

Supplier development – working closely with suppliers

Ten ways of Managing Supply Chain Risk1

2

3

4

5

6

7

8

9

10

Page 9: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Logistics and Supply Chains

Purchasing 55 – 65 %

Transport 3,5 – 7 %

Labor 2,5 – 6 %

Inventory 3 – 9 %

System and administration 1,5 – 3 %

Facilities 0,7 – 2 %

Range of expenditures as percentage of the sales

Page 10: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

What is Purchasing?MARKETING STRUCTURE AND DEMAND

Business markets contain fewer but larger buyers.Business customers are more geographically concentrated.

Business buyer demand is derived from final consumer demand.

Demand in many business markets is more inelastic - not affected as much in the short run by price changes.

Demand in business markets fluctuates more, and more quickly.

Page 11: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

What is Purchasing?NATURE OF THE BUYING UNIT

Business purchases involve more buyers.Business buying involves a more professional purchasing effort.

TYPES OF DECISIONS AND THE DECISION PROCESS

Business buyers usually face more complex buying decisions.The business buying process is more formalized.In business buying, buyers and sellers work more closely together and build close long-run relationships.

Page 12: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

To select the best suppliers in the market. To help generate the effective development of new products. To protect the company’s cost structure. To maintain the correct quality/value balance. To monitor supply market trends. To negotiate effectively in order to work with suppliers who will

seek mutual benefit through economically superior performance. To adopt environmentally responsible supply management.

More specific objectives of buying unit

Page 13: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Page 14: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

What is Purchasing?Purchasing and Change

Globalisation ImpactInformationTechnology

Impact

Chasing Production &Management

Philosophies Impact

• Transgression of national boundaries

• Advantage of cost

• Specialised labour skills

• Emerging economies

• Slicker transactions

• Quality of management data

• Strategic link with suppliers

• Paperless environment

• Competitive advantage

• Outsourcing

• Supply chain management

Supply networks

Page 15: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

What is Purchasing?

Increase in strategic importanceAutomated tactical activities

Master contractsElectronic purchasing

Strategic purchasing competency centresShared supply chain resources

Profit contributionChanged emphasis on individual skills

Purchasing in the Future

Page 16: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

The price/cost iceberg

Total acquisition costs and total cost of ownership

Page 17: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Structure and Supply Chains Seven Characteristics of New Type Organisations

RadicalDecentralisation

DemandingExpectations

DistributedLeadership

Networking &Reciprocity

IntenseInterdependence

TransparentPerformance

Standards

BoundaryBusting

„Small is beautiful“

+ multidisciplinary approaches

Leadership distributed among

people

Direct relationships and communication between individuals

Page 18: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

“A network structure is a series of strategic alliances that anorganisation forms with suppliers, manufacturers and distributors

to produce and market a product.”

A network is not a world of individual and isolated transactions.

Network structures allow organisations to bring resources together on a long-term basis to reduce costs.

Networks relate to all aspects of the supply chain, including marketing and distribution.

Page 19: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Factors in Configuration

Structure and Supply Chains

First-tier Suppliers

Second-tier Suppliers

Those that integrate for direct supply to the assembler or who have a significant technicalinfluence on the assembly while supplying indirectly

Those that supply components tofirst-tier suppliers for integration into systems or provide some support service

Page 20: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Page 21: UNIVERSITY OF ECONOMICS IN BRATISLAVA, SLOVAK REPUBLIC

Structure and Supply Chains

Convergent and divergent elements in a supply chain