Create a project supply and materials budget

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Reference no: EM13829490

TED BARTON

Ted Barton had become purchasing manager for the City of Cranston after having worked in private industry as a supply manager for several decades. He had been selected because the city's administrators wished to integrate sup¬ply better into the overall decision processes and to help search for better value for the taxpayer's dollars. Shortly

Ted Barton wondered whether any of the metrics he had recently developed were relevant for his decision on whether to extend the current mineral aggregates contract.

Since a significant number of existing city contracts were also of the multiyear, extendable type, he believed his actions on the aggregate contract might have a bearing on how to deal with other requirements. Having only one week left, he wondered what action to take.

EXHIBIT 2 City of Gnoston Prim Index for a 128-Item Basket of City Requirements

Year                                  3 Years

Ago

2 Years
Ago

1 Year
Ago

Current Year

 Q-1         Q-2          Q-3

Cost of supplies (basket of goods)              100.00

.9199

.9446

 .9477     .9410        .9614

312 Purchasing and Supply Management

 

 

 EXHIBIT 3 Selected List of Key Cost Indicators

 

 

 

 

 

 

Current Year

Key Indicators                    3 Years      2 Years

1 Year

Q-1

Q-2                 Q-3

Ago           Ago              

         Ago

 

 

Business prime rate (%)         7.000            6.875

4.250

4.750

5.00                5.00

CP1                                      111.4            114.7

116.2

121.9

122.0             122.2

Fats & oils                           161.82          165.38

194.44

218.99

221.02         236.98

Raw industrials                    258.06          235.55

231.72

258.69

260.01         269.91

Textiles                                236.39          230.50

221.41

234.29

241.01         239.83

Diesel fuel                             50.36            52.56

54.34

65.04

56.41             58.69

Coarse road salt                   57.28            52.91

52.91

52.91

52.91             52.91

Natural gas                          4.50               6.08

3.82

6.22

6.00                5.96

Copper (055 per ton)            1788.00       1578.00

1559.00

1663.00

1641.00     1753.00

Metals subindex                    236.06      193.55

178.92

201.50

207.09         218.15

a) Create a project supply and materials budget based on the information in the case.

b) Your budget must include a one page explanation on the importance of a materials supply budget and the impact of the budget on the supply organization.

Reference no: EM13829490

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