GROUP PROCUREMENT MANAGEMENT AND STRATEGIES

As our general policy, we aim at guaranteeing our “Sustainable, Accountable and Corporate” stranding by means of “Effective, Efficient and Dynamic” purchases in each line of our business. In parallel with these targets of ours, we have put into practice the common procurement organization operating with a focus on the quality and saving, which is to render service to our entire group. As a procurement organization aiming at contributing to the financials of our group companies with our staff targeting category-based specialization and the total cost management we have adopted and realizing their activities in an efficient manner, we have been continuing our studies at full steam. Nonetheless, we take firm steps forward institutionalization with a sustainable procurement understanding choosing, protecting, developing the correct supplier and being useful to the entire group and its supplier by means of the collaboration studies.

The main procurement groups in this category are as follows:
• Primary Aluminum
• Semi-finished, Folio and Commercial Goods
• Secondary Aluminum, Scrap and Dross
• Aluminum Additives/Alloying Materials

Alternative product and alternative development studies are achieved together with Assan Aluminum Technology and Planning teams.

The main procurement groups in this category are as follows:
• Iron and Steel
• Food-Raw Materials
• Chemical Materials
• Paper and Plastic

The purchases of items being the primary production input for different group companies of Kibar Holding are realized in this category. New/alternative material and supplier development studies are carried out with the relevant R&D, Technology, Quality, Planning, etc. teams of the group companies. In this group it is essential that the supply process is efficient and sustainable.

The main procurement groups in this category are as follows:
• Electrical and Electronic Materials and Services
• Hydraulic and Pneumatic Materials and Services
• Hardware Materials
• Machine Equipments and Services
• Shell and Rollers
• Installation Materials and Services

Besides, in parallel with the needs of the group companies, procurement of the maintenance, repair and professional workmanship services and certifications after the purchase is carried out. This group mainly works with a global suppliers’ network.

The main procurement groups in this category are as follows:
• Industrial Paints/Coil Coating
• Industrial Gases
• Auxiliary Materials and Services
• Laboratory Quality Materials and Services
• Mineral Oils and Lubrication Equipments
• Packaging Materials and Equipments

With respect to consumables consumed continually, regularly and in high quantities and the services required in usage thereof, the quantities of usage are optimized, new technologies are searched and alternative suppliers are developed by working in coordination with group companies.

In line with the group needs, all purchases relating to machinery and line investments, electricity, natural gas, water and coal agreements, and real estate and construction investments are realized in parallel with the vision of Kibar Holding as “Investment for Value Added Product”.

Real estate purchases comprise the valuation, lease and purchase activities while construction works comprise the purchases made for construction, alteration, furniture and furnishing. Prior to purchase decisions, detailed market researches are conducted and one determines whether the qualification criteria determined to be prerequisite for the projects (financial analysis, reference and certification/document controls, the line of business in which supplier has experience, etc.) are satisfied or not.

The main procurement groups in this category are as follows:
• Information Systems
• Below-the-line and Above-the-line Materials and Services
• Support Logistic Services
• Outsourcing
• Communication and Electronical Equipments
• Office Materials and Equipments
• Events
• Professional Services

It is focused on developing value added and long term business partners that may render service to the entire group and guaranteeing the sustainable efficiency.

The main procurement groups in this category are as follows:
• Road / Sea / Air / Railway / Intermodal Transportations
• Customs Clearance Services
• Warehousing Services
• 3rd Party Logistics Services

For meeting any kinds of insurance needs of the group companies such as health, fixed asset, liability, transportation, traffic, etc., agreements are entered into with local and international institutions for and on behalf of IRB Insurance and Reinsurance Brokerage, also being one of the group companies.

The group procurement standards of all purchases and implementation thereof within the framework of the operation model are guaranteed with the governance mechanisms. The global and local developments, innovative applications and strategies in sectors in which the group companies operate are followed up on a regular basis and alternative implementation proposals, different methodologies and approaches are determined. Prospective new suppliers to participate in the portfolio are procured to undergo preliminary evaluation processes and the existing suppliers are subjected to performance evaluation process on a periodical basis.