PURCHASING AND SUPPLY CHAIN MANAGEMENT Fourth Edition Robert M. Monczka Arizona State University and CAPS Research Robert B. Handfield North Carolina State University Larry C. Giunipero Florida State University James L. Patterson Western Illinois University Australia Brazil Japan Korea Mexico Singapore Spain United Kingdom United States Purchasing and Supply Chain Management, 4e © 2009 South-Western, a part of Cengage Learning Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson ALL RIGHTS RESERVED. No part of this work covered by the copyright herein may be reproduced, transmitted, stored or used in any form or by any means graphic, electronic, or mechanical, including but not limited to photocopying, recording, scanning, digitizing, taping, Web distribution, information networks, or information storage and retrieval systems, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the publisher. VP/Editorial Director: Jack W. Calhoun VP/Editor-in-Chief: Alex von Rosenberg Sr. Acquisitions Editor: Charles McCormick, Jr. Developmental Editor: Bryn Lathrop Marketing Comm. Manager: Libby Shipp Marketing Manager: Kristen Hurd Marketing Coordinator: Gretchen Wildauer Content Project Manager: Scott Dillon For product information and technology assistance, contact us at Cengage Learning Academic Resource Center, 1-800-423-0563 For permission to use material from this text or product, submit all requests online at www.cengage.com/permissions Further permissions questions can be emailed to
[email protected] Manager of Technology: John Barans Technology Project Manager: John Rich Prod. Technology Analyst: Adam Grafa Sr. Manufacturing Coordinator: Diane Gibbons Production Service: Newgen–Austin Art Director: Stacy Jenkins Shirley Cover Designer: Joseph Pagliaro Library of Congress Control Number: 2008926725 Student Edition ISBN-13: 978-0-324-38134-4 Student Edition ISBN-10: 0-324-38134-4 South-Western Cengage Learning 5191 Natorp Boulevard Mason, OH 45040 USA Cengage Learning products are represented in Canada by Nelson Education, Ltd. For your course and learning solutions, visit academic.cengage.com Purchase any of our products at your local college store or at our preferred online store www.ichapters.com Printed in the United States of America 1 2 3 4 5 6 7 12 11 10 09 08 To Shirley, Kathleen, Thomas, and Elliana ROBERT M. MONCZKA To Sandi, Simone, and Luc ROBERT B. HANDFIELD To Tressa, Jan, Matthew, Michael, and Amanda LARRY C. GIUNIPERO To Diane, Lindsay, Karl, Drew, and Seth JAMES L. PATTERSON Brief Contents Preface xxiii Part 1 Introduction 1 Chapter Part 2 Part 3 1 Purchasing Operations and Structure 35 Chapter Chapter Chapter 2 3 4 Chapter 5 Chapter 6 Chapter Chapter Chapter 7 8 9