Cost control case: Maxim-Manufacturers cooperate to reduce procurement costs. In 2112, Maxim Company, like most fast-growing enterprises, began to face growth bottlenecks. Xia Mingxian, the head of the company, resolutely adopted the strategy of exchanging profits for the market, greatly reducing the price of products. However, soon after the price reduction, the risk came unexpectedly, and the price of raw material steel suddenly soared. Continue to sell at low prices-the more you sell, the more you lose; Price-increasing sales-the reputation is wiped out, and it is difficult to gain a foothold. Facing the dilemma, reducing the cost, especially the procurement cost of raw materials, has become a life-and-death "life-saving straw" for Meixin! Xia Mingxian issued an order to the purchasing department: within three years from now, the comprehensive purchasing cost of enterprises must decrease at an average annual rate of 11%. This made the employees of Maxim's purchasing department a little dumbfounded and even unconvinced: Maxim's "open-shelf procurement bidding system" was the first in China, which not only effectively reduced costs, but also put an end to black-box operation, and CCTV made special reports on it. Moreover, this move has saved 1.5% of the purchasing cost for Maxim. What magic can make the frog slimmer? Driven by Xia Mingxian, Maxim's employees began to go out, from being used to sitting in an office to being used to going on the road, surpassing the shackles of experience, and unconsciously formed a set of cost reduction management mode. Joint procurement, respectively processing for small and medium-sized suppliers, Maxim will unite these supporting enterprises and purchase raw materials by them. Due to the expansion of procurement scale, the comprehensive cost has been reduced by 21%! The supporting enterprises bring back the raw materials from Maxim's for processing, and the semi-finished products produced are directly provided to Maxim's, and then the processing fee is collected from Maxim's financial department with the receipt. At the same time, with the reduction of raw material costs, supporting enterprises are also more competitive, with larger scale and lower prices, forming a virtuous circle. For the supply of raw materials, the strategic partner is aimed at the upstream mega-suppliers, that is, large steel enterprises at home and abroad. Maxim's approach is to shrink the procurement line and take the lead in becoming a big customer of one or two steel mills and even a strategic partner. The price of steel mills for strategic partners is 5%~8% lower than that of ordinary dealers and 1.5% lower than the retail price of the market. So only one purchase in 2112, Maxim saved nearly 11 million yuan compared with its peers. With the increasing procurement scale, Maxim's people began to have the weight to further negotiate with steel mills. At the request of Maxim, steel mills regularly provide the price trends of steel products and customize the purchase varieties for Maxim. For example, in the past, the standard size of steel plate was one meter, while the size of door plate was 91 cm, of which 11 cm could only be cut and thrown away. At present, steel mills tailor-made 91 cm steel plates for Maxim, which greatly reduces waste and saves costs. For example, they also specially developed a new material door frame for Maxim, the quality is the same, and the price can save 611 yuan per ton ... "New products are matched, and cooperation wins * * * For the production of new supporting varieties, because supporting enterprises need to increase a lot of investment, the price of new supporting products has increased significantly compared with other supporting products. Maxim has invested in the manufacturer with brand, equipment, technology, management and other software and hardware to form cooperation; The cooperation condition is that the price of the products used by Maxim's company can only be slightly higher than the production cost. In this way, the partners have reduced their investment and risk in the production of new products; At the same time, Maxim also reduced the purchasing cost of supporting products and increased the income. So all parties benefited, and everyone was happy ... milk run, optimizing logistics solved the procurement problem of raw materials and supporting products, and Maxim also cooperated with supporting enterprises to optimize logistics. Due to the lack of unified and standardized management of delivery in different supporting enterprises, all kinds of problems will be brought about in information exchange and transportation safety, which must cost both sides a lot of time and human resources. Maxim understands that the increase in logistics costs of supporting enterprises will be directly passed on to the prices of supporting products. So Maxim hired a third-party logistics supplier to design the distribution route, and then picked up the goods from different supporting enterprises, and then sent them directly to Maxim's production workshop. In this way, not only the transportation cost of supporting enterprises is saved, but also the logistics efficiency is improved. More importantly, these supporting products are directly pulled to the production workshop, keeping their own low inventory and saving a lot of inventory funds. Maxim's cooperation with raw material suppliers and supporting enterprises has enabled raw material manufacturers to have stable large customers, and supporting enterprises have reduced production risks, while itself has greatly reduced costs and expanded production and sales, forming a win-win situation for all parties. In 2112, Maxim's production and sales doubled year-on-year, and Maxim's comprehensive procurement cost decreased by 17%, which was 23% lower than the average level of the whole industry! Maxim's Company became the only enterprise that maintained a low price policy during the period of soaring raw material prices, and its corporate image was in full swing, and its channel construction finally took root.