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Procurement study guide question and answer 100 % correct

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Introduction 1 correct ANSWER Procurement & the Bottom Line Impact of Procurement on Profit - Certain industries are hugely impacted by procurement activities: a) Chemical manufacturing (65%) ... b) Engineering/Construction (64%) c) Pharma (64%) - Reduced responsibility: Financial Services (18%) - Lead example of huge impact: Walmart DuPont Analysis: Heineken - Impact of Procurement cost on ROCE - Reduced procurement cost -> reduced total cost -> increased operating profit -> increased sales margin -> increased ROCE - 2% decrease in procurement cost -> 1,1% increase in ROCE The Bottom Line - Procurement can have a direct impact on the bottom line of the organisation through two forces: 1. Increased sales 2. Lower Total Cost Introduction 2 correct ANSWER Definition of Procurement Purchasing: - All activities for which the company receives an invoice from outside parties - Managing the company's n [Show More]

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