Jun
1
What Is The Role Of A Buyer?
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In a sense, this question may seem a little basic. After all, it could be summed up by simply asserting that the role of a buyer is to …..BUY! however, like so many issues, there is much more than meets the eye to this question…..
First of all there are different kinds of buyers. For example, a buyer in a retail industry will have a different role from a buyer for a manufacturing company. Then there are pharmaceutical buyers or healthcare buyers.
However, no matter what ‘kind’ of buyer is being discussed, there are some areas of common ground. So the roles may vary according to whichever industry the buyer is located in, but there are some similarities.
Buyers Do More Than Buy!
The first thing that any buyer will tell you is that they do more than buy. They need a real understanding of the markets in which they operate. They need to be aware of all the possible fluctuations that can occur and even how the foreign exchange rates may impact on what they are about to purchase or have purchased.
Buyers also need to be financially astute and aware of exactly what is on offer and at what price, so they do not make the mistake of falling into bed with one supplier, only to find out that they could have sourced the goods at a more favourable rate elsewhere.
Buyers and Suppliers
Buyers also need to build up strong and trusting relationships with suppliers. If they fail to do this, then the supply chain can become weak and the risks of the supply chain being unable to cope with sudden variances can become a real threat to the successful flow of supplies.
So buyers need to work with the suppliers to make sure that they can deliver the supplies on a continuous basis and that the price will be as per the price that was agreed.
The days of very adversarial approaches o buying have long since disappeared and instead the buyer attempts to work with the supplier to ensure that the supply chain is effective and stable. But at the same time, the buyer still has to keep a watchful eye on what the supplier’s competitors is offering, to ensure that the company they are working for are getting the best deal.
In a sense therefore they are trying to foster good and very positive relationships with suppliers, whilst being aware that this is a business arrangement and the contract may be ended at any point.
Quality Control
Buyers also have a role in ensuring that the items they purchase are of good quality and that the quality is consistent, within set parameters. There is no point in buying shoddy goods, but the items need to be of a fairly standard quality with little in the way of variations. This means that the buyers have to be aware of quality issues and not allow price to outweigh the demand to have good quality products available.
Innovative Approaches
Buyers also have to be mindful of how things can change in the market place, with new products coming on the market that can replace products or goods. For example, if there is a new man made fabric that comes onto the market, that can be as good as wool and is far cheaper, then if appropriate suppliers should be switched, so that the new product can be used to replace the more expensive wool.
The role of a buyer is therefore one that is relatively multi-faceted and one that is often quite challenging and can be at times, relatively stressful, but ultimately quite a rewarding career!
Mar
20
What is a Product Life cycle
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Most products have a defined life cycle – consider the humble VHS video recorder or the 3 1/2 inch floppy disk drive – they were introduced into the market, became mass produced, saw huge growth as a global product were overtaken by technological change and saw their market retract and were withdrawn from the market.
Most products don’t have infinite life spans. The Product life cycle model is the concept that all products and services, left in their original state, have a life that goes though numerous stages – products are born, they mature, they grow old and they die!
The product life cycle stages are
• Introduction
• Growth
• Maturity
• Decline
• Withdrawal
The primary reason for the stages of the product lifecycle is the range of influencing factors – for example consider the impact of the following on a given part:
• Introduction of new technology
• Environmental factors
• Consumer factors / demand
• Obsolescence
• Governmental factors
The example of the VHS recorder earlier is a prime example – new technology was introduced (DVD and Blu-Ray) that impacted the position in the market – new entrants become more widespread, captured market share – which resulted in lower sales.
Charting the Product Lifecycle – The Gopertz Curve
The Product Lifecyle is often seen as a graph, sometimes called a Gopertz curve. This plots the sales through the various stages of development
Example Product Lifecycle chart
The product life cycle
Life cycles are not uniform – they will vary from product to product, industry to industry and commodity to commodity – there are a number of factors that might determine the particular shape of the life cycle from development time of the product – through to customer and lifespan of the product i.e. fad products or fashion products will have a different shape to say an automobile.
Product life cycles are an important factor to consider in developing supply chain strategies as they can provide an insight into the movement of price and availability and ensure that your strategy is representative of the current situation of the parts.