Title: Planning of global sourcing from total acquisition cost perspective

Authors: Henri Janhonen

Addresses: Hiab Oy, Sornaisten rantatie 23, 00501 Helsinki, Finland

Abstract: The share of companies| revenue spent on purchases has increased significantly; an average company spends over half of its earnings in procurement. Therefore, efficient management of sourcing is crucial in succeeding in the competed marketplace. The topic studied in this paper is how total acquisition costs related to alternative sources of supply should be analysed. Relying on previous theories, a framework for modelling supply-chain costs is established to address the cost effects of altering a source of supply. The established supply-chain cost model is applied to material flows of Kalmar in a specific case study to demonstrate the analysis approach.

Keywords: global sourcing; total cost of ownership; total acquisition costs; technology planning; technology intelligence; modelling; supply chain costs; material flows; supply chain management; SCM.

DOI: 10.1504/IJTIP.2008.017405

International Journal of Technology Intelligence and Planning, 2008 Vol.4 No.1, pp.95 - 114

Published online: 04 Mar 2008 *

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