THE IMPACT OF SOURCING AS A SUPPLY CHAIN FUNCTION ON THE PROFITABILITY OF A COMPANY

Over the years, procurement function contains activities that have attracted the attention of many researchers and companies worldwide. However, most studies conducted focused only on the manufacturing industries and associated with functional indicator. This research presents and discusses some key points and noticed important changes recording the ways business are carried out. In connection with the market worldwide process managerial models have been customer constantly reviewed and improved, as well as new concepts and paradigms, such as the contemporary business and mass customization, have quickly emerged. It is this competitive context that the supply chains management (SCM) should be understood.

          A supply chain can be represented by a group of integrated logical process that originates from source of raw materials and comprises several companies, until products are delivered to final customers in form of goods and aggregated services.

In the past, every layman in Nigeria were ignorant of what exactly purchasing and supply is all about. Most people believe that procurement of raw materials is non-task or a non-issue matter. Foremost, most manufacturing companies of which ZARTECH LIMITED MAYA happens to be one of them, dispose more than half of its income on materials, supplies and services. We would bear in mind that intensive sourcing is the rudiments of purchasing.

          Sourcing comprises of the identification or development of suitable sources. Sourcing decision indicates which supplier to patronize. How many suppliers are needed to supply a given item? How to allocate available business and in what term to do the business, the continuing relationship both with preferred sources which are still in the running although they have been passed over for the present.

          For its proper performance, sourcing requires supply market research. This is often undertaken informally by the buyers as part of their buying work, when they interview salesman, visit exhibition, read trade journals, obtain catalogues and research the market before placing an order. It is sometime undertaking formally by research personnel, in a purchasing services section as a support function to the buyers. Supply market research identifies the set of actual and potential supply sources which contribute the market, investigates their capabilities analyses the structural features of the market trends and long term supply prospects, and generally keep on ear to the ground.