PURCHASING DEPARTMENT INDICATOR (Purchasing Department) Before talking about indicators, I would like to illustrate their importance. Without measuring our work, it is very difficult to have parameters to prove our efficiency and discover where we are failing, but these parameters also serve to show the effectiveness of your work within the company. Suppose you want a raise, how can you prove to your superiors that you deserve this raise? In most cases, it is not enough to just go into a room and ask for this raise, you need to prove it in numbers and indicators help us a lot with this, so even if your company does not use these indicators, I suggest that you create and use them, even if it is just for yourself, because at some point the opportunity will arise to show this data and present your work not only in words but also in data. Saving Saving: The function of this indicator is to evaluate the cost reductions achieved by buyers. If you searched for indicators for the purchasing department, this is most likely one of the main indicators that appears. The Saving indicator basically represents how much was budgeted and how much was actually spent. Let's give an example: You have 3 proposals from different suppliers, R$120, R$110 and R$100. If you close for R$100, how much savings did you get? None. But, if you close for R$90, you have secured 10% savings and this is your savings. So the Saving indicator will measure how much you were able to negotiate within a budget, this will allow you to measure and show your superiors or even yourself how efficient your negotiation is. You can also do the saving indicator in the following way: suppose I bought a material for R$100, but in the next purchase I can get it for R$90.00, also saving 10%. But in this case you may be conditioned by the market and its variations, so be careful! On-time delivery: Another very important indicator, cited by Dias and Costa (2003), basically aims to monitor the supplier's delivery, known by many as the famous FOLLOW UP, which can be: Preventive: with the objective of anticipating the supplier's delivery failure, for example, my supplier has a delivery on the 5th, a week before I call this supplier, reviewing this delivery and checking if everything is "ok", for delivery on the agreed day. Corrective: When the supplier has already delayed the delivery and this communication is made to minimize the delay time in delivery. Within this, I can set up an indicator showing the assertiveness in deliveries, for example, how much delay was reduced through the follow-up work and this work has a great impact mainly on stock and production, because as we know any delay in delivery harms the entire supply chain. Price evolution: Basically, it is what you are imagining right now, monitoring the evolution or modification of the price of a product over time. It may seem basic, but this information can provide you with arguments for negotiations and debates in meetings, and this can be done through graphs or tables in a system or even in an Excel spreadsheet. This is an indicator that is widely used in companies, but on the other hand, it is used informally, that is, without having the data recorded for more accurate analyses. Cycle time: or time known as release time, it is basically the time it takes the buyer to make the purchase as soon as they receive the order. This calculation excludes the supplier's delivery time. Let's take an example. Suppose the PPC placed an order for raw material. On May 4, this order is approved, a quote is made, and then the buyer places the order with the supplier on May 8. You see, the time between the request and the purchase of the product was 5 days. This indicator is super important, because when calculating replenishment, if this time is not considered, we will most likely have problems with inventory, as we will lose 5 days. Productivity: We can measure the amount of purchases made by the buyer, the amount of purchase requests made. This shows the efficiency obtained by the sector on a monthly basis. We put 5 indicators in this video, but the purchasing sector allows for several other indicators and if you remember any, comment here in the video. COMPLETE PLAYLIST ABOUT THE PURCHASING SECTOR: • 5 indicators for the purchasing sector... purchasing sector of a company purchasing sector what does the purchasing and supply sector do purchasing sector indicators supply chain #purchasingsector #purchasingdepartments #purchasingindicator