Understanding Indirect Spend

Calculating indirect spend
Understanding Indirect Spend In any area dealing with procurement, you will likely hear the term “indirect spend,” along with “direct spend.” You might also hear references to “indirect materials,” “GNFR,” “indirect procurement,” “overhead,” and “variable and fixed indirect costs.” It may come as a surprise, but these terms have roots dating back to 1760 during the Industrial Revolution, when cost accounting was first introduced to calculate the cost of a product in order to calculate th...
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Understanding GNFR

Goods not for resale, or GNFR
Understanding GNFR Cost accounting was originally introduced during the Industrial Revolution so that businesses could organize their operational/manufacturing costs to price their products in order to turn a profit. Though indirect spend is a term that was coined during this time, GNFR—a subset of indirect spend—is a more modern phrase in the procurement world. GNFR, or goods not for resale, is often a difficult concept for individuals to comprehend. This is largely due to the fact that...
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Understanding GFR VS GNFR

GFR VS GNFR
Understanding GFR VS GNFR Those who work within a company’s accounting department know exactly how to account for direct and indirect spend without question. However, the same cannot necessarily be said for those who work outside of accounting. Understanding the difference between GFR vs GNFR can be extremely helpful for addressing problems in each one’s respective supply chain, which is why we’ve laid out the similarities and differences between these two types of goods. GFR and GNFR D...
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