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  • 1.
    Furusköld, Jenny
    et al.
    Linköping University, Department of Management and Engineering, Industrial Economics.
    Hall, Emma
    Profitable negotiations: A case study regarding purchase-, transport- and inventory costs at ABB2016Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE creditsStudent thesis
    Abstract [en]

    ABB is a global company with a leading position in power and automation technologies. Being active on a global market creates a high pressure to always develop the business and reduce costs in order to stay competitive. The purchasing function at ABB ́s unit Control Products is divided into a strategic- and an operative purchase department. The negotiated setups the strategic purchasers establish with the suppliers have been shown to affect the transport- and inventory costs that are charged to the operative purchase department. In order to determine whether more beneficial setups could be negotiated by including transport- and inventory costs when they are evaluated, this case study has been requested. Two master students from Linköping University have conducted the study and by investigating different setups, conclusions to answer the study ́s purpose could be drawn. The purpose is presented below.

    The study’s purpose is to recommend future guidelines for the strategic purchasers at ABB’s unit Control Products that can be applied when negotiating with suppliers, by evaluating purchase-, transport- and inventory costs.

    In order to investigate how the purchase-, transport- and inventory costs were affected by different setups, four different cases were defined. Each case included a specific article, which was chosen based on its properties and its current and alternative setups. The conducted literature reviews and interviews with employees at Control Products resulted in the two sub- criteria lead time and net price were defined as the most important ones when negotiating and evaluating suppliers. A combination of these sub-criteria was therefore used to choose suitable articles. Once the cases had been defined, the purchase-, transport- and inventory costs could be calculated for both their current situation and alternative setup scenarios. Theories from relevant researches were used to strengthen and criticised the cases’ results.

    Each case's result provided information regarding how the purchase-, transport- and inventory costs were affected by specific setups. By comparing the alternative scenarios with the setup currently used, the alternatives ́ profitability could be determined. The cases showed that by only studying one of the three cost posts, only a limited insight was gained. Even if the purchase cost was to increase for an alternative setup, it could still be profitable to implement due to decreased transport- and inventory costs. Furthermore, an alternative setup that showed significant potential to reduce inventory costs was proven to not be profitable because of its effect on the net price. Neglecting to take transport- and inventory costs into account when a potential supplier is evaluated can make a deal look more profitable than it is.

    The final recommendation is that purchase-, transport- and inventory costs all have to be taken into consideration in order to determine which setups that are economically preferable. If the strategic purchasers at Control Products includes these when they negotiate with suppliers, more profitable deals can be obtained. 

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    Profitable negotiations
  • 2.
    Gustafsson, Johan
    et al.
    Linköping University, Department of Management and Engineering, Machine Design.
    Milesson, Gustav
    Linköping University, Department of Management and Engineering, Machine Design.
    Furusköld, Jenny
    Linköping University, Department of Management and Engineering, Machine Design.
    Svedlindh, Klas
    Linköping University, Department of Management and Engineering, Machine Design.
    Ljung, Albin
    Linköping University, Department of Management and Engineering, Machine Design.
    Båtshake2014Independent thesis Basic level (degree of Bachelor), 12 credits / 18 HE creditsStudent thesis
    Abstract [en]

    The report discusses the bachelor’s thesis that five students were assigned in the spring of 2014. The goal of this thesis includes the development and production of a product that facilitates the mooring of boats, for example to buoys and piers. This paper covers the work process resulting in a product design of a boat hook that facilitates mooring. This product was designed to meet the customer needs identified during a market survey. The report analyzes the manufacturing methods and materials in order to find appropriate ones for the production of the designed product. The report describes how the concept and design was developed assisted by various concept generation methods. To test the product design and its features a prototype similar to the developed design was produced. This was tested in a realistic working environment, but also in a simulated one. The conclusion was that the prototype met the required customer needs that were put forth throughout the project.

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    fulltext
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