Value-driven vs market-driven purchasing of kitchen cabinets
(2010) p.202-211- Abstract
- In economic and management literature, the relationship between supplier and buyer can be more or less intimate. It can vary from market-driven with a constant change of suppliers to a value-driven relationship with one sole supplier. Purchasing strategies of construction companies have often been described as short-sighted, where price is the most considered aspect. Recent lean management literature promote value-driven purchasing, since it provides benefits such as just-in-time delivery, zero defects and customized products through close technical collaboration. This article hypothesises that value-driven purchasing of customized kitchen cabinets is more profitable than market-driven purchasing in industrialized housing construction. The... (More)
- In economic and management literature, the relationship between supplier and buyer can be more or less intimate. It can vary from market-driven with a constant change of suppliers to a value-driven relationship with one sole supplier. Purchasing strategies of construction companies have often been described as short-sighted, where price is the most considered aspect. Recent lean management literature promote value-driven purchasing, since it provides benefits such as just-in-time delivery, zero defects and customized products through close technical collaboration. This article hypothesises that value-driven purchasing of customized kitchen cabinets is more profitable than market-driven purchasing in industrialized housing construction. The hypothesis is examined through a case study of kitchen carpentry at one of Swedens largest producers of industrialized prefabricated multi-storey housing. By comparing characteristics of market-driven vs. value-driven purchasing, this article aims to further clarify the benefits and drawbacks of these two strategies. At the case company, kitchens are ordered cabinet-by-cabinet and then installed inside the factory. The company is considering the possibility of a long-term relationship with a smaller local supplier that can deliver a new kind of innovative kitchen cabinet solution that is prefabricated. If the local supplier can meet the expectations of just-in-time delivery, zero defects and a product tailor-made for the housing company, there is much to gain. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/75a71283-bf21-4a2a-a555-f112ff58cbca
- author
- Bildsten, Louise LU ; Björnfot, Anders and Sandberg, Erik
- publishing date
- 2010
- type
- Chapter in Book/Report/Conference proceeding
- publication status
- published
- subject
- keywords
- Purchasing, Construction industry, Supply chain management, lean purchasing, prefabrication, purchasing strategies, Ssupply chain management
- host publication
- Proceedings of the 18th Annual Conference of the International Group for Lean Construction
- pages
- 10 pages
- external identifiers
-
- scopus:84866116265
- language
- English
- LU publication?
- no
- id
- 75a71283-bf21-4a2a-a555-f112ff58cbca
- date added to LUP
- 2016-12-07 15:43:27
- date last changed
- 2022-01-30 08:16:42
@inproceedings{75a71283-bf21-4a2a-a555-f112ff58cbca,
abstract = {{In economic and management literature, the relationship between supplier and buyer can be more or less intimate. It can vary from market-driven with a constant change of suppliers to a value-driven relationship with one sole supplier. Purchasing strategies of construction companies have often been described as short-sighted, where price is the most considered aspect. Recent lean management literature promote value-driven purchasing, since it provides benefits such as just-in-time delivery, zero defects and customized products through close technical collaboration. This article hypothesises that value-driven purchasing of customized kitchen cabinets is more profitable than market-driven purchasing in industrialized housing construction. The hypothesis is examined through a case study of kitchen carpentry at one of Swedens largest producers of industrialized prefabricated multi-storey housing. By comparing characteristics of market-driven vs. value-driven purchasing, this article aims to further clarify the benefits and drawbacks of these two strategies. At the case company, kitchens are ordered cabinet-by-cabinet and then installed inside the factory. The company is considering the possibility of a long-term relationship with a smaller local supplier that can deliver a new kind of innovative kitchen cabinet solution that is prefabricated. If the local supplier can meet the expectations of just-in-time delivery, zero defects and a product tailor-made for the housing company, there is much to gain.}},
author = {{Bildsten, Louise and Björnfot, Anders and Sandberg, Erik}},
booktitle = {{Proceedings of the 18th Annual Conference of the International Group for Lean Construction}},
keywords = {{Purchasing, Construction industry, Supply chain management; lean purchasing; prefabrication; purchasing strategies; Ssupply chain management}},
language = {{eng}},
pages = {{202--211}},
title = {{Value-driven vs market-driven purchasing of kitchen cabinets}},
year = {{2010}},
}