MAGAZINE №2 (79) April 2017


CATEGORY  Sourcing


The supplier estimation and selection process is far from the TCO (Total Cost of Ownership) concept usage in many Russian companies. The majority of companies generally focus on the price, paying no attention to other significant for finances factors. In this article the correlation between the company’s procurement function maturity and the applied supplier estimation and selection methodology is provided. The widespread mistakes of typical methodologies usage are discussed. The recommendations for taking into account the maximum number of significant factors are given. Also, the ways for changing estimation models from one to another, more advanced, are mentioned. The conclusions about the different methods usage practicability on different companies’ evolution stages and the necessity of reconsidering and changing these methods with the companies’ increase and development in order to correspond with the global tendencies are made. 

 Electronic version


Published in Sourcing

MAGAZINE №4 (75) August 2016


CATEGORY Sourcing 


In supply logictics one of the strategic objectives is to «Make or Buy» (MOB) decision. For example, a production company before entering into contracts with suppliers, must answer the question: Is not it more profitable to the company to produce individual components for the assembly of the finished product than to buy them from other companies. For traders, a similar problem can be solved, for example, in relation to the procurement of logistics services, as an alternative means of transport agent, is considered the acquisition and operation of their own cars. Thus, companies can achieve significant savings in operational costs and significantly improve the profitability of the business.

In carrying out various activities on their own, the cost structure of the company is a fairly wide range of calculation items, most of which does not depend on the activity of the company in the market. On the contrary, resorting to the services of intermediary companies, the number of elements of costs narrows considerably and most of them goes into the category of variables. This arrangement, on the one hand, allows you to focus on the quality of products and the most complete satisfaction of end users, but at the same time, leaving without due attention to the costly side of the issue and its impact on the profitability of the company.

In solving the problem «Make or buy», used a model «Total Cost of Ownership» (TCO), which in addition to the selling price of the supplier considered wholesale prices, terms of payment and the amount of transport costs, which in turn are determined depending on the type of transport. In addition, the total costs were taken into account marketing and transaction costs associated with the analysis of the market of goods and services, as well as the alignment of interaction with suppliers.

As a result of the calculations made in the article, it was shown that in spite of the generally accepted lately attractiveness of outsourcing, with sufficient scale and regularity of the business, expanding the list of functions and the implementation of additional activities, can have a positive impact on the economic results of the company.


Published in Sourcing

MAGAZINE №5 (64) October 2014


CATEGORY Simulation Corporate logistics industrial companies


This article demonstrates how to use the method of simulation modeling in AnyLogic in order to optimize the logistics network of industrial company operating in the industrial gas market. The model detailed basic processes associated with the transport of the product, the service requests of customers and distribution of the product to consumers. Factors were taken into account, bearing the stochastic nature, such as unevenness of production, weather conditions that affect the level of demand, the number of failures of vehicles, vehicle repair time. On the developed model, a number of scenario studies, which identified the optimal values of the control parameters of a logistics network: the number of rolling stock, additional storage capacity, minimizing the loss of the deficit and the lack of free rolling, leading ultimately to lower total cost of ownership (TCO) .


Published in Simulation modelling


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