The product or service must be available at the right time. Provide these products or services at the correct level of quality a. Poorer quality usually results in lower yield, more defects, etc. Poorer quality at a lower price can actually increase total costs. Provide these products or services for the lowest total cost a.
Most companies spend about half of their sales on purchased parts, materials, and services.
Purchasing philosophy A. Adversarial philosophy 1. Maintain several vendors for each product or service purchased 2. Views suppliers as the opposition 3. Assumes the supplier will take advantage of the buyer 4. Leads to lower buyer-seller relationship quality 5.