04/10/2023 1

Supply Chain Management

A solution to Procurement Flows of BDX Company (Ltd)

04/10/2023 2

Group Members

V. Dinusha

S. Saatviga

S.Y.Y.D. Wickramasinghe

K.T. Wickramasuriya

D. Wijethilake

04/10/2023 3

Contents

Introduction BDX

Current Procurement Process

Issues

Solution Catalysts

Alternatives

Comparison & Proposed Solution

Added Values

Current Vs Proposed

Conclusion

Reference

04/10/2023 4

Introduction

BDX is A leading apparel exporter in SL

Manufactures “leisurewear” for US based brands

Imports from China, Hong Kong & India▪ 40 % of Raw

Raw Material Procurement is Handled by Merchandising team

Being questioned by Management team▪ Delays▪ Miscommunications▪ Payment Disputes

04/10/2023 5

Existing Procurement Process

BDX Supplier

Merchandiser

PAS

Warehouse

Finance

1. Raw Material Requirement

2. Download PDF PO

3. Email / fax PDF PO (Delivery Date)

4. Confirmed Delivery Date via email /fax /phone 5.

Replicate PO

6. Sales Order

7. Raw Material + Invoice

8.GRN

9. Invoice

10. Compare PO, GRN & Invoice

11. TT

04/10/2023 6

IssuesIssuesDelays

Document ProcessingPO / Sales Order / GRN

Delivery / Comparison / Confirmation

Raw Material Delivery

Payment Delays

MiscommunicationSupplier & BDX

Supplier & T2 Supplier

Finance Dept & Warehouse

Payment Disputes

04/10/2023 7

Solution

Catalysts Sourcing Strategy ▪ Expedite the procurement process

Central Hub▪ Partner Collaboration ▪ Information Sharing

Workflow Management▪ Streamline standard tasks through automation▪ Decision points & Conditional Requirements to trigger

events▪ Distributed Responsibility & Accountability▪ Real Time status update of workflows & associated

documents▪ Pending / Delivered / Accepted, etc

04/10/2023 8

Alternative 01

Sourcing Strategy – JIT

Centralized Hub Manufacturer

Suppliers T1

Suppliers T2

Customer

Workflow Management Customer -> Supplier T2

04/10/2023 9

Alternative 02

Sourcing Strategy – VMI

Centralized Hub

Manufacturer

Supplier T1

Workflow Management

Manufacturer -> Supplier T1

04/10/2023 10

Alternative 03

Sourcing Strategy JIT – High Value, Low Volume items VMI – Low Value, High Volume Items

Centralized Hub Manufacturer Suppliers T1 Suppliers T2 Customer

Workflow Management Customer -> Supplier T2

11

ComparisonNO Aspect Alternative 01 Alternative 02 Alternative 03

1 Sourcing Strategy JIT VMI JIT & VMI

2 Central Hub for • Manufacturer• Customer• Supplier T1• Supplier T2

• Manufacture• Supplier T1

• Manufacturer• Customer• Supplier T1• Supplier T2

3 Real Time Information Flow

Yes Yes Yes

4 More Suitable for • High value• Low volume

• Low value• High volume items

• Both

5 Responsiveness Slow Quick Moderate

6 Probable Delay More Less Moderate

7 Waste Less More Moderate

8 Probable Payment Disputes

More Less Moderate

9 Predictive Power Less More Moderate

10 Productivity Less More Moderate

04/10/2023 12

Proposed Architecture

Customer1.Order

Placement

Central Hub

2. MRP

BDX T1 Supplier(s)

T2 Supplier(s)

3.Order Trigger

3. Order Predicti

on

Merchandiser

PAS

3.Order Trigger

Purchase

Order

Sales Order

4.Purchase

Details

5.Confirmation

Warehouse

Invoice6.Raw

Material

GRN

Finance

7.Verify Raw Material Acceptance

8. Compare PO, GRN, Invoice

Payment

Gateway

9.Payment

04/10/2023 13

Current Vs ProposedNO Aspect Current

SystemProposed Solution

1

Material Requirement Planning

PAS Central Hub

2 Raising Purchase Order Manually Raised Automatic

3 Sending Purchase Order Email/ Fax Central Hub

4 Delivery Date Request Email/ Phone Real Time (Central Hub)

5 Delivery Date Confirmation E-mail/ Fax Real Time (Central Hub)

6 Sales Order Supplier Central Hub

7 Maintaining Changes Ad-hoc Centralized

8 Commercial Invoice Supplier Central Hub

9 Goods Received Note Warehouse Central Hub

10 Comparing PO, GRN & Invoice

Manual Automatic

11 Payment Telegraphic Transfer

Online

04/10/2023 14

Benefits & Mitigated Risks

Streamline Existing Procurement Process Minimize Delays

Electronic Integration of data Automation of Business Practices

On-time & Error free payments through automation

Online Payment Enhance Communication through Effective Information Flow

(Suppliers, Departments) Timely Accurate Paperless

Proactive Reminders on Delivery Dates Automated Verifications Tracking & Monitoring the Procurement Process Backup System and Recovery Processes

04/10/2023 15

Conclusion

More Profit

04/10/2023 16

Reference

Integrated end-to-end ePocurement: the

foundation of spend management success http://www.enporion.com/media/whitepapers/End-to-End-

Procurement_Final.pdf

http://sspcatalog.sap.com/catalog/results.jsp?ps=

1&Solutions_Platform_Lookup=R1-R6&Certificatio

n=R4

04/10/2023 17

Thank You !