Brief explanation of enterprise MRO procurement strategy

Generally, companies adopt a policy of on-demand procurement based on financial and inventory management needs; however, in addition to production, there are actually many items that are not directly related to orders that need to be ordered. These items are collectively referred to as MRO (warranty operation) consumables. Their book value is usually small, but if they are purchased without a system, they may become a big loophole in the company's operating costs. This article will introduce the importance of MRO procurement management and recommend effective MRO procurement strategies.

MRO is also known as an "indirect procurement" project because these consumables are used every day, but are not/cannot be directly incorporated into any final product. Imagine if there were no stationery, workshop tools, protective tools, or even a small battery in the workshop in addition to various parts. Can the company still operate effectively?

MRO Procurement Strategy

Many companies believe that the annual MRO procurement cost is very small, and do not fully understand that improper MRO procurement will bring a lot of hidden costs. In fact, an effective MRO procurement strategy can achieve long-term and sustainable cost-effectiveness and help companies control expenditures.

The book value of many MRO projects is relatively small, but the average overall procurement cost may be twice the value of the product. RS Electronics' study of corporate procurement behavior found that organizations need to spend an average of 20 yuan to purchase MRO goods worth 10 yuan. The main reason is that procurement personnel spend too much time looking for the cheapest products, which is not worth the cost; and the internal procurement and payment procedures are too complicated, which may also lead to additional costs (such as supplier approval process time, bank transaction fees, etc.).

Establishing awareness of centralized purchasing

Research shows that although the procurement department is usually the driving force behind program changes, the participation and cooperation of all stakeholders in procurement, including engineering, operations and finance personnel, is crucial to achieving a successful MRO procurement strategy. Through centralized procurement of MRO suppliers, companies can order different types of consumables in a single order, without having to deal with multiple suppliers and process payments for each order, improving procurement work and saving transaction costs.

When choosing an MRO supplier, product variety and local inventory are also important considerations. Take RS Electronics as an example. The company offers more than 500,000 products. With a strong international and local supplier network and advanced warehouses in Shanghai, it has a rich inventory of products in electronics, electrical, automation and control, testing and measurement, engineering tools and consumables. It can meet the needs of large-scale public utilities, high-tech industries, general manufacturers and various types of enterprises. It can be said to be a successful example of a one-stop supplier of MRO products.

RS Electronics' "11.11 Shopping Carnival" has officially started on October 16! The event includes 20 mainstream manufacturers and brands, covering 15 popular product categories and a total of 5,000 discounted products. It is a discount event truly designed for engineers, providing original and genuine high-quality products at the best price.

From November 6th to 17th, we will offer a "hot promotion phase", launching 1,000 special products at 50% off in addition to the original discounted products; plus 13 "hot-selling" products will be sold at a "random grab" price of 10% off, which you definitely can't miss!

RS Electronics' "11.11 Shopping Carnival" offers discounts on almost every aspect of engineers' needs. From now until November 30, you can get the best discounts of the year by visiting the RS Electronics website. Visit our event page now! Or call our customer service hotline for details!

Website: http://china.rs-online.com/