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Collaborative Procurement

  1. Feryal Erhun

Published Online: 14 JAN 2011

DOI: 10.1002/9780470400531.eorms0156

Wiley Encyclopedia of Operations Research and Management Science

Wiley Encyclopedia of Operations Research and Management Science

How to Cite

Erhun, F. 2011. Collaborative Procurement. Wiley Encyclopedia of Operations Research and Management Science. .

Author Information

  1. Department of Management Science and Engineering, Stanford University, Stanford, California

Publication History

  1. Published Online: 14 JAN 2011

Abstract

According to a recent US Department of Commerce survey, for every dollar of sales revenue, 50 cents are spent on component procurement in the US manufacturing industry. It is therefore crucial that firms manage their procurement effectively in order to maintain a competitive edge in the market. One way of achieving this goal is to change the nature of intra- and inter-firm relationships from adversarial to collaborative. Through collaboration in procurement, firms may lower their costs, reduce their inventory, increase their sales and revenue, and utilize their resources more efficiently. In this article, we provide a brief overview of collaborative procurement.

Keywords:

  • collaboration;
  • intra-enterprise collaboration;
  • inter-enterprise collaboration;
  • horizontal collaboration;
  • vertical collaboration