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MASTER CLASS PROCUREMENT & NEGOTIATION

MASTER CLASS PROCUREMENT & NEGOTIATION. WHAT ARE WE GOING TO LEARN TODAY?. WHAT IS PROCUREMENT? WHAT IS NEGOTIATION? WHY IS IT IMPORTANT? HOW DOES KOTAHI PROCURE/NEGOTIATE? HOW CAN YOU USE WHAT YOU’VE LEARNED TODAY?. WHAT IS PROCUREMENT?.

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MASTER CLASS PROCUREMENT & NEGOTIATION

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  1. MASTER CLASSPROCUREMENT & NEGOTIATION

  2. WHAT ARE WE GOING TO LEARN TODAY? • WHAT IS PROCUREMENT? • WHAT IS NEGOTIATION? • WHY IS IT IMPORTANT? • HOW DOES KOTAHI PROCURE/NEGOTIATE? • HOW CAN YOU USE WHAT YOU’VE LEARNED TODAY?

  3. WHAT IS PROCUREMENT? • To define procurement broadly, “Procurement” is the overarching function that describes the activities and processes to acquire goods and services. Importantly, and distinct from “purchasing”, procurement involves the activities involved in establishing fundamental requirements, sourcing activities such as market research, vendor evaluation and negotiation of contracts.

  4. THE PROCUREMENT PROCESS. • Define the business need • You need to understand what the fundamental customer/business requirement is. • Develop the Procurement Strategy • What outcomes do we want to achieve - short/med/long. • Strategic vs Transactional. • Supplier Selection and Evaluation • Evaluate the solutions available and their fit to customer/business need. • Negotiation and award. • Cost, criteria, capability, fit to customer/business need, aspiration, risk, reward. • Induction and Integration • Contract, compliance and communication. • Monitor adherence and performance.

  5. WHAT IS NEGOTIATION? • “Negotiation” is the process by which typically two or more parties come together to try to create a mutually agreeable contractual decision. Each party will have competing interests and, thus, negotiations can be quite intricate and lengthy. Negotiations end when all parties have come to a final decision and have agreed to contractual guidelines.

  6. ACTIVITY - 1. • CUSTOMER REQUIREMENT • 1,000 CONTAINERS PER WEEK TO DREAMLAND • OPTIONS • CARRIER A 300 TEU CAPACITY $1000 • CARRIER B 700 TEU CAPACITY $2000 • CARRIER C 600 TEU CAPACITY $2000 • CARRIER D 200 TEU CAPACITY $1000 • CARRIER E 800 TEU CAPACITY $1000 • SOLUTION • ??????????

  7. WHY IS PROCUREMENT IMPORTANT?

  8. WHY IS NEGOTIATION IMPORTANT?

  9. CAN WE PROCURE WITHOUT NEGOTIATION? • WHAT ARE THE DISADVANTAGES? • WHAT ARE THE ADVANTAGES? • DO YOU ALWAYS HAVE TO NEGOTIATE?

  10. WHAT ARE WE BUYING FOR? • 220,000 TEU • 140 DESTINATIONS • 9 ORIGIN PORTS • 14 SHIPPING LINES • 15 CUSTOMERS • DAIRY, MEAT, PRODUCE, TIMBER, WOOL, SEAFOOD………

  11. KOTAHI PROCUREMENT PROCESS. • Define the business need • WHO AND WHAT’S INVOLVED? • Develop the Procurement Strategy • WHAT’S KOTAHI’S STRATEGY? • COLLABRATIVE APPROACH – CUSTOMER INVOLVEMENT. • Supplier Selection and Evaluation • HOW DO WE DETERMINE WHAT CARRIERS TO USE? • VENDORS AS PARTNERS. • Negotiation and award. • RFP AND TENDER PROCESS. • Induction and Integration • COMMUNICATION, CONTRACTS, SYSTEMS. • SLA’S AND KPI REPORTING.

  12. ACTIVITY – 2. • CUSTOMER REQUIREMENT • 1,000 CONTAINERS PER WEEK TO DREAMLAND • VOLATILE DEMAND – SOMETMES 500 PER WEEK, SOMETIMES 1500 PER WEEK • TRANSIT TIME ALLOWED 20 DAYS • CAN’T SHIP IN PINK CONTAINERS • OPTIONS • CARRIER A 300 TEU CAPACITY $1000 15 DAYS BLUE CNTRS • CARRIER B 700 TEU CAPACITY $2000 17 DAYS RED CNTRS • CARRIER C 600 TEU CAPACITY $2000 16 DAYS BROWN CNTRS • CARRIER D 200 TEU CAPACITY $1000 21 DAYS GREEN CNTRS • CARRIER E 800 TEU CAPACITY $1000 14 DAYS PINK CNTRS • SOLUTION • ??????????

  13. CAN I PROCURE/NEGOTIATE? • WHAT ARE YOUR KEY LEARNINGS FROM TODAY? • HOW AND WHERE CAN I APPLY WHAT I HAVE LEARNED? • HOW CAN I SUPPORT THE BUSINESS WITH WHAT I HAVE LEARNED?

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