Modern Practices of Procurement Logistics Management at the Enterprise

Abstract

Procurement logistics is considered as one of the main directions of activity that influences the efficiency of enterprise. The works of economists on the topic of the research were analyzed, and different interpretations of the concept of «procurement logistics» were considered. It is specified that there is no single correct definition, but all scholars tend to think that procurement logistics is a set of activities aimed at providing the enterprise with material resources, choosing sources of supply, controlling the fulfillment of orders. Each stage of the enterprise’s procurement logistics is characterized. Particular attention is paid to the stage of selecting sources of supply, as it is up to the supplier to fulfill the objectives of both procurement logistics and the enterprise in general. A detailed research on this process allows to more effectively identifying the ways to improve logistics activities at the enterprise. The process of developing a logistics strategy is considered, when managers try to reach a compromise between the three main objectives of procurement logistics: reducing capital, reducing costs and improving the level of service. It is proposed to include some aspects of procurement logistics management inherent in one of the most prominent transnational corporations (TNCs) Nestl? in the activities by other enterprises to improve their efficiency. The TNC Nestl? has developed a Responsible Sourcing Standard that reflects the current tendencies in procurement logistics to find a reliable supplier and defines the criteria that the supplier must meet. The vectors of procurement management at the enterprise have been identified, which are universal and will allow enterprises to improve the efficiency of logistics management, as well as to minimize costs.

Keywords

• procurement logistics
• supply
• material resources
• enterprise
• business processes