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Sourcing Overview / What We Buy

The primary responsibility of Kennametal’s Sourcing function is to provide for the procurement of materials, supplies, and services; with the objective that they will be available at the contracted delivery date, in the correct place, and in quantity, quality, and price consistent with the needs of the company. This is to be accomplished through the establishment of competition, evaluation and selection of suppliers, and by negotiation and placement of commitments for the company.

The Vice President of Global Sourcing is responsible for the procurement of all goods and services, and to provide either the services for such procurement and processing, or give functional direction to others delegated to perform such services.

Sourcing has the responsibility for obligating Kennametal, and for making the final determination of source of supply, quantities purchased, delivery schedule, and price negotiations, except where others are so authorized. These decisions will be made in conjunction, as appropriate, with Operations, Inventory Control, Finance, and other departments.

Sourcing is responsible for the following:

Direct Material:
Materials that are directly used in the production of products and manufacturing that affect the value of the finished product. Types of direct materials include raw materials, operating supplies and components. Direct materials are usually subject to inventory management.

Indirect Material:
Materials that support plant operations including machinery, maintenance and repair items, tooling, packaging, janitorial services, business supplies, temporary labor, health care and professional services.

Product Resale and Custom Solutions:
Product Resale purchases finished items necessary to satisfy customer demand. Custom Solutions are products that are made specifically to meet a customer requirement. These are products that Kennametal Engineering and/or Manufacturing elected to have provided from an outside supplier instead of producing within a Kennametal manufacturing plant.

Negotiations are handled by the appropriate Sourcing personnel within their delegated authority.

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