Procurement strategy

The key question is formulated as follows when it comes to the strategic: if a supply service and the supply chain can effectively contribute to achieving the organization's objectives and its strategies? In addition, there is another important question: how the goals and strategy of the organization can accurately reflect the contributions and capabilities of the supply chain? Strategy is a plan of action worked out to achieve specific long-term goals and objectives. The strategy should pay enough attention to the key factors necessary for success, and identify the essential actions needed to be done now so that the desired results are obtained in future. This is the process of determining the relationship between the organization and its environment, long-term goals and creating desirable connections, with the help of efficient and effective allocation of resources.
Procurement strategy is a plan for procurement services activities designed to achieve the desired goals and objectives. If properly designed business strategy links with its environment, with a long-term planning being used for this purpose. Total procurement strategy consists of the following six major categories:
1.  The strategies of supply warranty. They are designed to guarantee a future supply needs, which focuses on quality and quantity. Supply warranty strategy is to regard  changes in the both proposal and supply. The most essential part of procurement research related ​​ aims at obtaining the necessary information.
2 . Cost reduction strategy. They are designed to reduce costs for the purchase of relevant goods or services, or the total cost of use, that is, costs throughout the product life cycle. When changes in the environment and technologies are made, the alternatives that reduce the overall operating costs of the organization through the replacement of materials, sources, methods and nature of the relationship of buyers and suppliers, may become available.
3. Strategy of the supply chain support. Their circuits are designed to improve knowledge and essential characteristics of the members of the supply chain for the procuring entity. For instance, in order to notify each other of any changes or meeting the needs of reserves and production targets on time, more sophisticated system of communication between buyers and sellers are requitred. Members of the supply chain also need good relationships to achieve higher quality and better systems.
4. Environmental change strategies are developed in anticipation of changes in the general environment (economic, organizational, personnel, legal, regulation and control authorities, as well as the availability of systems), and therefore, the procuring entity may use these components to produce long-term benefits.
5. Competitiveness strategy. They need to exploit market opportunities and the organization's strengths, thanks to them; it was able to achieve significant competitive advantage. In the public sector, the term “competitive advantage” can usually be interpreted as good results in achieving the goals .
6. Strategy of risk management. These strategies are aimed at efficient management of the following risks: 1) risk of disruption of the flow of goods or services, 2) the risk of a significant price change of the purchased goods , and 3) reputational risk.