Purchase and buy decision , Other Management

Assignment Help:

Purchase and Buy Decision 

The project manager or the production manager of a project has to decide whether to buy or make a part, so that it is available at the right schedule to ensure continuity in manufacturing/work process, as all these activities are highly time bound. Any delays in schedules will cause a cascading effect on overall project resulting in cost overruns. There are no universal rules applicable across projects. It varies widely from project to project. 

For a manufacturing project, the factors favouring in house manufacture are as follows: 

  •   In house cost less than supplier cost 
  •   Capacity utilisation in house in terms of machine hours and man-hours. 
  •   To retain process confidentiality. 
  •   To retain high level of quality. 
  •   To keep up schedules particularly if long process cycles are involved post this part. 

The factors favouring buy out are as follows: 

  •   Elimination of capital expenditure. 
  •   Utilisation of specialist facility. 
  •   Lesser buy out costs than in house cost. 
  •   Focus on one?s own area of specialisation.  

Related Discussions:- Purchase and buy decision

Library reinforced binding, Library Reinforced Binding: Reinforced bin...

Library Reinforced Binding: Reinforced binding means strengthening the book by adding some material. It could be strengthening of the hinge with cloth or the reinforcing a pal

Reference services, Reference Services: Reference services help the us...

Reference Services: Reference services help the user define and identify his query correctly, bearing in mind how he intends to use the information, since this can affect the

What do you understand by the term organizational culture, Question 1: ...

Question 1: (a) Explain the meaning of ‘Authority', ‘Power' and ‘Politics' in the context of an organisation. (b) What are the strategies that are usually used by Manager

Quality planning, Q uality planning Quality planning helps to schedule...

Q uality planning Quality planning helps to schedule all the tasks required to ensure that the project meets the customer needs. Quality plan is necessary to give the customer

Conflicting factors - problems in acquisition, Conflicting Factors: De...

Conflicting Factors: Demand, supply and finance are the three major factors governing collection development. Both demand and supply will be increasing while finance will be a

Main features of the new public management, Question 1: Elaborate on th...

Question 1: Elaborate on the weaknesses of the Traditional Model of Public Administration. Question 2: Define the term "Administrative Reform". Why is it so critical i

Why ethics is important in procurement, QUESTION 1 (i) Why ethics is im...

QUESTION 1 (i) Why ethics is important in procurement? (ii) How a public official involved in planning or conducting public procurement proceedings or contract administratio

Legal requirements for hospitality establishments, Question 1: Designs ...

Question 1: Designs need to be practical, functional and rational. According to you and with appropriate examples from the hospitality industry, what are the common problems fa

Hospitality facilities management, Make yourself aware of the range of issu...

Make yourself aware of the range of issues involved in the "Greening of Hotels" phenomenon by reading widely on the topic. Become conversant with the full range of current and e

Periodicals and serials - selection tools, Periodicals and Serials: Pr...

Periodicals and Serials: Primary periodicals constitute one  of the most indispensable categories of publications  in academic  research and special libraries. A substantial p

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd