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Article
Publication date: 1 February 2005

Jean Nollet and Martin Beaulieu

The article deals with issues such as the size of a purchasing group, the types of benefits aimed for, and the real beneficiaries of purchasing groups.

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6894

Abstract

Purpose

The article deals with issues such as the size of a purchasing group, the types of benefits aimed for, and the real beneficiaries of purchasing groups.

Design/methodology/approach

The observations are based on the literature, as well as on interviews, mostly with Canadian and US health‐care managers.

Findings

Although often associated with the public sector, purchasing groups are also an alternative considered more and more by managers of the private sector. A purchasing group increases volume consolidation, making it possible to have only one negotiation, in order to increase the purchasing group members' power vis‐à‐vis that of its suppliers. However, a purchasing group also constitutes an additional link in the supply chain and its objectives could go contrary to those of some of its members. This is why organisations considering joining a purchasing group should analyse this option strategically, in order to assess correctly the potential long‐term benefits.

Originality/value

This article suggests key questions and an analytical framework to help managers assess the potential benefits and drawbacks of joining a purchase group.

Details

Supply Chain Management: An International Journal, vol. 10 no. 1
Type: Research Article
ISSN: 1359-8546

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Article
Publication date: 1 April 1990

Larry C. Giunipero and Robert M. Monczka

Analysis of the organisational structures utilised to conduct international purchasing activities was undertaken at 24 multinational corporations. The majority of the…

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1038

Abstract

Analysis of the organisational structures utilised to conduct international purchasing activities was undertaken at 24 multinational corporations. The majority of the corporations studied had decentralised purchasing organisations and all had corporate purchasing staffs. Four basic approaches were found: (1) totally decentralised; (2) co‐ordinated; (3) totally centralised; and (4) separate international purchasing group. Within this overall framework there were several forms of staff assistance to assist operating units effectively accomplish their international purchasing goals. This assistance included foreign buying offices, trading companies and international staff specialists. There was also a common philosophy which indicated the necessity of worldwide sourcing.

Details

International Journal of Physical Distribution & Logistics Management, vol. 20 no. 4
Type: Research Article
ISSN: 0960-0035

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Article
Publication date: 14 June 2021

Pricivel Carrera, Sükran Katik and Fredo Schotanus

Little is known about actual price savings generated by cooperative purchasing and nonmonetary advantages, disadvantages and impediments for the cooperative purchasing of…

Abstract

Purpose

Little is known about actual price savings generated by cooperative purchasing and nonmonetary advantages, disadvantages and impediments for the cooperative purchasing of complex or high-risk purchases. This paper aims to explore these topics by studying joint purchasing of pacemakers in The Netherlands.

Design/methodology/approach

To evaluate the magnitude of price savings, data on individual and collective prices for 18 hospitals was analyzed. In addition, 16 interviews were carried out with representatives of hospitals that participated and did not participate in the joint purchase.

Findings

Based on quantitative and qualitative data, the authors found large differences in price savings which can be attributed to scale, but mostly to knowledge of the group and renewing a contract in a technology-driven and developing market. Limited product choice – because of an organization joining a cooperative – constrained the attractiveness of cooperative purchasing, as end users may have specific product preferences. The consideration of preferences of end users is important toward successful joint purchasing of complex items.

Social implications

The authors argue that price savings because of scale are about 7% for smaller organizations and 4% for larger organizations. For smaller organizations with low specific knowledge and capacity for buying complex products, economies of process and knowledge are more important reasons for joining a purchasing group than scale. For large organizations with high specific knowledge and capacity, scale is the most important reason.

Originality/value

This study combined qualitative and quantitative perspectives, using actual spend data, to investigate cooperative purchasing of high-risk or complex purchases. On the one hand, more insight into the magnitude and reasons for price savings is provided than in earlier literature. On the other hand, more insight is given in qualitative reasons for joining a group and challenges for cooperative purchasing of complex items.

Details

Journal of Public Procurement, vol. 21 no. 2
Type: Research Article
ISSN: 1535-0118

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Article
Publication date: 2 March 2015

Chiara Gobbi and Juliana Hsuan

– The purpose of this paper is to investigate how buyers and the vendors pursue alignment in collaborative purchasing (CP) of complex medical technologies.

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2052

Abstract

Purpose

The purpose of this paper is to investigate how buyers and the vendors pursue alignment in collaborative purchasing (CP) of complex medical technologies.

Design/methodology/approach

Through a literature review in CP, the paper identify factors for shareholder alignment (i.e. aligning the needs of the buyers within the purchasing group) and customer alignment (i.e. aligning buyers’ needs with the vendors offering strategies) and investigate how they manifest in the case of CP of complex technology in the Danish National Healthcare System.

Findings

Shareholder alignment requires appropriate management of the relationships, expertise and guidance in simplifying procedures and effective management of the purchasing group. Customer alignment is facilitated by buyers’ understating of the vendor’s design options, which are moderated by the vendor’s design strategies.

Research limitations/implications

The findings and generalizations from a single case study are limited to the complexity of the purchased technology and the specific cultural context. However the paper represents the first explorative study that poses the attention on the relevance of shareholder and customer alignment in CP.

Practical implications

The study can offer hospitals, vendors, governmental and regional institutions a better understanding about the alignment mechanisms for successful implementation of CP and how to avoid pitfalls.

Originality/value

Literature on CP is scarce as there are virtually no contributions that debate the key elements and tradeoffs that need to be considered for strategic alignment. The study addresses this gap.

Details

International Journal of Operations & Production Management, vol. 35 no. 3
Type: Research Article
ISSN: 0144-3577

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Article
Publication date: 1 March 2017

P. Fraser Johnson, Michiel R. Leenders and Clifford McCue

This research focuses on a comparison of public and private sector supply organizations in terms of organizational structure, supply chain responsibilities, the chief…

Abstract

This research focuses on a comparison of public and private sector supply organizations in terms of organizational structure, supply chain responsibilities, the chief purchasing officer (CPO) and reporting line, teaming and involvement in major organizational activities. A unique opportunity to identify similarities and differences was presented in 2000 when the National Institute of Governmental Purchasing Research (NIGP) and Florida Atlantic University replicated in the public sector a study that the Center for Advanced Purchasing Studies (CAPS) conducted in the private sector in 1995. Significant differences and similarities are identified and are discussed in this paper.

Details

Journal of Public Procurement, vol. 3 no. 1
Type: Research Article
ISSN: 1535-0118

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Article
Publication date: 1 November 2013

Doug Voss

The purpose of this paper is to explore the differences in preferred supplier choice criteria between food purchasing agents who focus on supplier security and those that…

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1345

Abstract

Purpose

The purpose of this paper is to explore the differences in preferred supplier choice criteria between food purchasing agents who focus on supplier security and those that do not. Specifically, this research determines the relationship between purchasing agents’ supplier security preferences and their preferences for product quality, delivery reliability, price, and supplier location. The influence of international sourcing on demand for increased supplier security is also explored.

Design/methodology/approach

Choice-based conjoint analysis with hierarchical Bayes (HB) estimation and t-tests are used to assess and compare the utility food purchasing managers derive from different supplier attributes.

Findings

Purchasing managers that place a higher priority on security when choosing suppliers were willing to pay suppliers a higher price and receive lower levels of delivery reliability in return for higher security but placed less emphasis on suppliers’ product quality. Firms that source internationally do not have a significantly greater preference for advanced supplier security. However, purchasing managers that value supplier security were more likely to source internationally, potentially indicating that security allows for global sourcing by mitigating the increased vulnerability inherent to sourcing abroad.

Research limitations/implications

This research was limited by its focus on the food industry and a relatively small sample size.

Practical implications

This work illustrated that food purchasing managers can be segmented by the emphasis they place on security. Food industry managers will find results useful in formulating their future service offerings with respect to security and other supplier choice criteria.

Originality/value

This is one of few works investigating security as a supplier choice criterion and utilizing HB estimation of choice-based conjoint data.

Details

The International Journal of Logistics Management, vol. 24 no. 3
Type: Research Article
ISSN: 0957-4093

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Article
Publication date: 1 July 1997

Larry C. Giunipero and Robert M. Monczka

Discusses analysis of the organizational structures utilized to conduct international purchasing activities which was undertaken at 24 multinational corporations. The…

Downloads
3431

Abstract

Discusses analysis of the organizational structures utilized to conduct international purchasing activities which was undertaken at 24 multinational corporations. The majority of the corporations studied had decentral‐ ized purchasing organizations and all had corporate purchasing staffs. Four basic approaches were found: (1) totally decentralized; (2) co‐ordinated; (3) totally centralized; and (4) separate international purchasing group. Within this overall framework there were several forms of staff assistance for helping operating units effectively to accomplish their international purchasing goals. This assistance included foreign buying offices, trading companies, and international staff specialists. There was also a common philosophy which indicated the necessity of worldwide sourcing.

Details

International Journal of Physical Distribution & Logistics Management, vol. 27 no. 5/6
Type: Research Article
ISSN: 0960-0035

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Book part
Publication date: 13 August 2014

Frank Elter, Paul N. Gooderham and Svein Ulset

This paper revisits Bartlett and Ghoshal’s transnational theory of the MNC in relation to multi-domestic MNCs. We argue that the aggregate level of analysis adopted by…

Abstract

This paper revisits Bartlett and Ghoshal’s transnational theory of the MNC in relation to multi-domestic MNCs. We argue that the aggregate level of analysis adopted by Bartlett and Ghoshal is unhelpful for identifying significant changes in multi-domestic MNCs at the level of discrete functions. We argue that a more disaggregated level of analysis is required. Our analysis of two cases of multi-domestic MNCs that have undertaken the global integration of their locally distributed purchasing functions indicates that while significant change to the purchasing function has occurred, at the aggregate level both MNCs remain multi-domestic. In both cases the decision to integrate local purchasing was regarded as having more obvious benefits than integrating other functions such as marketing. While both of our case multi-domestic MNCs may in future choose to integrate other functions and develop into full-fledged transnational companies we argue that there is no inevitability to this. Indeed global integration may cease with the purchasing function. A second theme in this paper is that we argue that Bartlett and Ghoshal’s transnational theory has a biased view of what constitutes effective governance mechanisms for achieving global integration, local responsiveness and worldwide learning and that it would greatly benefit from a more balanced application of hierarchical and relational governance mechanisms.

Details

Orchestration of the Global Network Organization
Type: Book
ISBN: 978-1-78350-953-9

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Article
Publication date: 1 August 1993

Melvin R. Mattson and Esmail Salehi‐Sangari

Compares the processes for decision making during the acquisitionof equipment and materials among firms in the USA, Sweden, France andSoutheast Asia. Reports the findings…

Abstract

Compares the processes for decision making during the acquisition of equipment and materials among firms in the USA, Sweden, France and Southeast Asia. Reports the findings from a detailed questionnaire in which 236 firms in the four‐country area participated. The companies provided data on buying centre influences and supplier search criteria with half reporting for capital production equipment acquisition and the other half for key production materials. It was found that buying decisions in Sweden have the highest team effort while the USA has the least, even though the American and Swedish firms had very similar demographics. Sweden depended on technical staff, both their own and suppliers′, much more than the other countries. There was no consistent pattern for purchasing department involvement. Except for the USA capital equipment buying centres were much more inclusive than materials buying centres.

Details

International Journal of Physical Distribution & Logistics Management, vol. 23 no. 8
Type: Research Article
ISSN: 0960-0035

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Article
Publication date: 6 February 2017

Madeleine Pullman and Robin Wikoff

This purpose of this paper is to understand the environmental impacts of stakeholder-driven sustainable purchasing policies in institutional settings.

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2177

Abstract

Purpose

This purpose of this paper is to understand the environmental impacts of stakeholder-driven sustainable purchasing policies in institutional settings.

Design/methodology/approach

The research is framed using stakeholder and life cycle assessment (LCA) theories. The study uses a multi-method approach. Starting with interviews to understand the breadth of sustainability issues and significant food purchases facing institutional purchasing managers, the authors subsequently perform LCA of these various policies using the most popular food item in different categories.

Findings

From the interview results, the authors found that food purchasers focus predominately on cost, thus, are committed to food and packaging reduction. They are driven to buy local foods based on their consumer stakeholders but share their commitment to buying local products if the cost is appropriate. In the LCA of popular food items in multiple scenarios, avoiding food waste of various forms had significantly higher carbon emissions savings than packaging reduction or transportation minimizing (buy local) strategies.

Research limitations/implications

The sample relied solely on the perceptions of institutional purchasing managers in university dining services. Future research should involve collecting data from other stakeholder groups such as the customers themselves, institutional leaders, and in other types of institutional settings such as hospitals and government agencies.

Practical implications

The research provides managers with insights concerning the trade-offs between different sustainability objectives. In particular, findings show that reducing waste related animal protein has a bigger impact on environmental performance than many other popular sustainability objectives such as buying local or reducing packaging waste.

Social implications

The paper focuses on the purchasing trade-offs of buying local vs national food products, different packaging solutions, and food waste generation. These decisions offer some social benefits (improve the economic situation for local farms vs consolidated food producers) as well as multiple environmental benefits.

Originality/value

The paper presents new findings on the sustainability purchasing priorities of stakeholders in institutional food settings and subsequent LCA of those policies to show which might have the most environmental impact.

Details

International Journal of Operations & Production Management, vol. 37 no. 2
Type: Research Article
ISSN: 0144-3577

Keywords

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