Explanation
The purchasing department at Cameron Balloons carry out several functions that are often separated in larger firms. The main functions are:
- Buying
- Stock control
- Goods inwards
Each of these are complex functions, and the purchasing department is a busy one. They deal with around 1,000 different suppliers. A balloon has many components parts and in most cases they are supplied by small specialist production firms. Many purchasing departments would have nightmares over these sort of figures!
Out of these 1,000 suppliers around 12 or so are key major suppliers to Cameron's. They probably account for around 50% of the purchasing business. Some of these suppliers are almost certainly solely dependent on Cameron's for their survival - an interesting relationship for both!
The specialist nature of many of the products means that the lead times (the time it takes from order to delivery) can be long. This means that the purchasing department have to plan well ahead and monitor stock levels very carefully. For example let's look at the problems with ordering fabric. How would you cope with this situation?
- If the supplier has the fabric in stock it will take 3 days to arrive
- If it has to be made specially, it will take around 8 weeks to arrive
- Around 1000m of fabric per day is used when in full production
For some burner parts the lead times are even longer. Some may take up to 3 months to arrive. Other burners arrive much quicker as they are made in-house!
The stock control is done with a computer system - vital given the complexity of the task faced by the department. The system was written in-house to ensure that it was customised to the particular requirements of the company.
In some cases there are several different suppliers for the same problem - there are 3 different basket 
makers, but only one cylinder supplier. The lead time for cylinders is about 8 weeks partly because they have been specially designed by Cameron's to meet their rigorous standards.
