Guide to a strategic procurement planning approach on regulated commodity markets

Abstract

The access of Virtual Organizations to raw materials normally requires external resources. In many cases, the market for raw materials is regulated and the VO principles of trust, customer orientation etc. are not applicable. In consequence, the VO needs to provide reliable solutions for the customer while being dependent on the access to the required raw materials. The objective of the proposed paper is to present a guide to a strategic procurement planning for the manufacturing industry on regulated commodity markets. This guide can be used to evaluate specific sourcing options. The main goal of this guide is to identify the negative effects of market regulation at an early stage and reduce them by developing strategic alternatives. The successful application of this guide is demonstrated by the practical example of the refractory industry and one of their commodities, refractory grade bauxite. © 2009 IFIP.