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Types of Industrial Customers Commercial enterprises

Manufacturing

Non-manufacturing Institutional customers

Public/private

Hospitals, educational institutions etc

Government customers

PSUs

Govt Departments Electricity, Irrigation etc

Cooperative Societies

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Classification of Industrial Goods &

Services Raw materials, components and sub-assemblies

Capital items

Plant & building Heavy equipment (machinery)

Light equipment (hand tools)

Consumables

Operating consumables

Maintenance consumables

Services: Legal, advertising, courier etc

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Purchasing Orientations Buying Orientation: Price, quality and

availability

Procurement Orientation: Strategic focus andproactive

Collaborative relationship with supliers

SCM Orientation:

Deliver to end-user

Outsource non-core activities

Support collaborative relationship with

major suppliers

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Purchasing Practices In Commercial Enterprises:

Initiation from user dept.

Check stock position Identify potential suppliers

Get quotations, evaluate, negotiate

Issue P.O. (quantiy, quality, time) Establish long term relationship

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Purchasing Practices In Government Units:

DGS&D for standard products

Competitive bidding Closed bidding/sealed tender

Open bidding/open tender

(complex projects) Reverse bidding

Govt. contracts: Fixed or with PVC; LD

clause, special payment terms

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Environmental Analysis Internal:(Strength and Weakness analysis)

Company location

Reputation (Brand) R&D capability

Production facilities

Marketing effectiveness Financial resources

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Environmental Analysis Information sources on environmental factors:

Business press, govt. publications, trade

journals, internet and professionalpublications

External:(Opportunity and Threat analysis)

Micro: (Affects a particular firm)

Customers

Competitors

Suppliers

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Environmental Analysis External:(Opportunity and Threat analysis)

Macro: (Affects all firms)

Economic Demographic

Natural

Technological Govt., Political, Legal

Cultural and Social

Public

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Environmental Analysis Strategies for managing External Environment:

Independent stategies using own

strengths Cooperative stratgeies through CII,

FICCI

Integration strategies to strengthen

within the value chain:

Backward and Forward

Horizontal integration to seek control

some of its competitors