Annual budget preparation

[sri2007]

I am working as a purchase enginner, i need to know the important factors to be considered for preparing next year annual budget plan along with these what are the cost saving factors to be considered.Our industrt deals with deals with steel tubes and fasterners.

 

[gerhardl]

Rule no 1:
If quality (dependabillity, duration, standtime, solidity etc.) has anything at all to do to getting customers and increasing sales over time, do not go down on quality!

Rule no 2:
Explain the head of the purchasing department that based on rule no 1 it is unlikely that next years buying budget could content large savings.

Rule no 3.
Savings may be found elswhere within the company: administration, logistics (limiting stock/capital binding in wares under processing), credit handling (get your mony fast, pay your debitors early and require discount).

Rule no 4.
Regularily discussion with suppliers to foresee changes, news, supply situation and prices. At least two alternative suppliers, both qualified, in competition.