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Abstract

This research focuses on evaluating the main characteristics that are considered in commodity procurement decisions used by food manufacturers. The research contributes to the literature by filling a gap in both the commodity and procurement literature. There is a large literature on commodity selling, but very little on commodity procurement. Further, much of the literature on procurement focuses on non-commodity products, not commodity products. A case study approach was used to determine the factors that affect commodity procurement decisions and to examine the strategic nature of commodity procurement departments. Further, the research developed a model of commodity procurement decision making. First, a commodity procurement department must maintain supply. Once this is accomplished, a commodity procurement department can progress to a profit-focused strategy. Finally, the commodity procurement department can expand by offering additional services to customers, such as designing promotional programs.

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