What factors affect supply chain management practices on procurement in an organisation?

There are several factors that can affect supply chain management practices related to procurement in an organization. Here are some examples:

  1. Demand variability: The variability in customer demand can impact procurement decisions, such as the quantity and timing of orders, and the use of safety stock. High demand variability can require more agile procurement practices to ensure that inventory levels are sufficient to meet customer needs.
  2. Supplier relationships: The nature and quality of relationships with suppliers can impact procurement practices. For instance, strong relationships with suppliers can lead to more favorable pricing, more reliable delivery, and better collaboration.
  3. Technological advancements: Technological advancements such as the use of big data, analytics, and artificial intelligence can enable organizations to make more informed procurement decisions and automate processes, such as demand forecasting and supplier selection.
  4. Globalization: Globalization can impact procurement practices by introducing greater supply chain complexity, higher risk, and a need for greater coordination with suppliers and distributors in different regions of the world.
  5. Regulations and compliance: Regulatory requirements such as product safety standards, labor laws, and environmental regulations can impact procurement decisions, such as supplier selection and product sourcing. Organizations need to ensure that they are compliant with regulations and that their suppliers are as well.

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