This document provides an overview of purchasing management. It discusses the objectives of purchasing which include acquiring satisfactory materials at proper prices and quality. It outlines the key functions of a purchasing department, which are processing requisitions, locating suppliers, placing orders, and following up on orders. It also describes different methods of purchasing such as according to requirements, for a future period, on the market, through contracts or schedules. The document concludes with the typical steps in a purchase procedure from departments submitting requisitions to receiving and inspecting delivered items.
Purchasing Management
Principles of Purchasing Management OR (8 R'S)
Functions of Purchasing Management
Negotiating
Value Engineering
VALUE ANALYSIS
Receive Purchase Request
Supplier selection
Payment Authorization
Market research and Information
Selection of Source
Determination of Price and Availability
Follow Up
Purchasing and procurement in Material managementKaustubh Vartak
Purchasing is a subset of procurement. Purchasing generally refers simply to buying goods or services. Purchasing often includes receiving and payment as well.
Purchasing Management
Principles of Purchasing Management OR (8 R'S)
Functions of Purchasing Management
Negotiating
Value Engineering
VALUE ANALYSIS
Receive Purchase Request
Supplier selection
Payment Authorization
Market research and Information
Selection of Source
Determination of Price and Availability
Follow Up
Purchasing and procurement in Material managementKaustubh Vartak
Purchasing is a subset of procurement. Purchasing generally refers simply to buying goods or services. Purchasing often includes receiving and payment as well.
Purchasing is the formal process of buying goods and services. The purchasing process can vary from one organization to another, but there are some common key elements.
The process usually starts with a demand or requirements this could be for a physical part (inventory) or a service. A requisition is generated, which details the requirements (in some cases providing a requirements speciation) which actions the procurement department. A request for proposal (RFP) or request for quotation (RFQ) is then raised. Suppliers send their quotations in response to the RFQ, and a review is undertaken where the best offer (typically based on price, availability and quality) is given the purchase order.
Stores management is part of the overall function of materials management. In order, therefore, to understand the function of the former it is desirable to have a clear understanding of what materials management stands for.
According to Alford and Beatty “storekeeping is that aspect of material control concerned with the physical storage of goods.” In other words, storekeeping relates to art of preserving raw materials, work-in-progress and finished goods in the stores.
WAREHOUSING AND STORAGE IN SUPPLY CHAIN MANAGEMENTAjeesh Mk
This Presentation "Warehousing and storage in supply chain management" covers topics Warehouse and Storage, Warehouse Management, Functions, Economic and Service Benefit, Principles of Warehouse design, Kinds of Warehouse etc.
Purchasing is the formal process of buying goods and services. The purchasing process can vary from one organization to another, but there are some common key elements.
The process usually starts with a demand or requirements this could be for a physical part (inventory) or a service. A requisition is generated, which details the requirements (in some cases providing a requirements speciation) which actions the procurement department. A request for proposal (RFP) or request for quotation (RFQ) is then raised. Suppliers send their quotations in response to the RFQ, and a review is undertaken where the best offer (typically based on price, availability and quality) is given the purchase order.
Stores management is part of the overall function of materials management. In order, therefore, to understand the function of the former it is desirable to have a clear understanding of what materials management stands for.
According to Alford and Beatty “storekeeping is that aspect of material control concerned with the physical storage of goods.” In other words, storekeeping relates to art of preserving raw materials, work-in-progress and finished goods in the stores.
WAREHOUSING AND STORAGE IN SUPPLY CHAIN MANAGEMENTAjeesh Mk
This Presentation "Warehousing and storage in supply chain management" covers topics Warehouse and Storage, Warehouse Management, Functions, Economic and Service Benefit, Principles of Warehouse design, Kinds of Warehouse etc.
PURCHASING PROCEDURES, E-PROCUREMENT, AND SYSTEM CONTRACTING pter 007 instru...Zamri Yahya
• Purchasing Procedure
• System Contracting
• E-Procurement
• Reverse Auctions
• Electric Data Interchange (EDI) and Purchasing
Radio Frequency Identifications (RFID)
Introduction to Sales Management – The Sales Organization
– Determining Sales Related Marketing Policies – Sales
Functions and Policies – International Sales Management
– Personal Selling.
Sales Planning – Sales Budgets – Estimating Market
Potential and Forecasting Sales – Sales Quotes – Sales &
Cost Analysis, Sales Force Management: Hiring and Training Sales
Personnel – Time and Territory Management –Compensating Sales Personnel – Motivating the Sales Force
– Leading the Sales Force – Evaluating Sales Force
Performance.
Marketing Logistics - Distribution as Marketing Mix
Element – Distribution Resource Planning – Marketing
Channel Integration – Channel Management – Nature of
Marketing Channels – Evaluating Channel Performance-
Specialized Techniques in selling – Tele Marketing – Web
Marketing
Distribution Cost Analysis: Managing Channel Conflicts –
Channel Information Systems – Wholesaling – Retailing –
Ethical And Social Issues in Sales and Distribution
Management.
This document is for Internal Auditors who find it very difficult to handle Procurement Audit. It simplifies the approach, the people, the expectation, reactions and the strategy to successfully handle procurement mostly in oil and gas companies around the World.
Running head PURCHASING ORGANIZATION METRICS REPORT .docxtodd581
Running head: PURCHASING ORGANIZATION METRICS REPORT 1
PURCHASING ORGANIZATION METRICS REPORT 3
Purchasing Organization Metrics Report
Zachary T. Trigger
UMCG
Purchasing Management
Professor James Swaim
February 23, 2020
To obtain suppliers for the muscles from turkey legs, heart of pigs, alligator claws, corn leaves and Kelp from the Chesapeake Bay, the company would need to consider the various legal ramifications of purchasing. There is need for the company to routinely sign purchase orders and contracts which commit them to the specific terms and conditions of purchase orders and contracts. There are several essential elements of a purchase order and they include:
I. The two parties, both the company and the suppliers, must be capable of delivering
II. The subject of the matter must be legal and valid
III. There must be mutual consideration
IV. The parties must reach an agreement by offer and acceptance.
All four elements have to be present for the contract to be legal. If any of the elements is missing it makes the agreement unenforceable before a court of law.
The details of the purchase contract need to be well defined and it should not be carried out in a hasty manner. This is because, once the contract has been approved, there are no changes which can be accepted. In addition to the purchase contract, a purchase requisition should be made available as it specifies the required parts. This is important because the five items which are required by the company are part of a whole and hence the need for the purchase requisition. These contracts are aimed at binding the supplier and the company together and to provide security to the company for a source of their raw materials. Whenever the company requires the raw materials to be supplied, a purchase order has to be created. This provides a records of the details of the raw material to be supplied by the suppliers.
Several elements need to be clarified in the contract to ensure that there are no misunderstandings between the supplier and the company. The first is the quality of the raw materials that the suppliers will supply and this ensures consistency and surety of products the company receives. The second component highlights the cost of the raw materials, that is the price which the suppliers will supply the raw materials per unit. The duration before the raw materials are supplied should also be specified to allow the company to calculate the lead time and avoid running out of raw materials. Finally, the duration of payment should also be outlined in the contract to stipulate the time taken before payment is made.
REQUEST FOR PROPOSAL
Company name
Introduction
The company requests for proposals from qualified supplying firms to supply the raw materials required in the manufacture of products used in laboratory testing. For the production of the end product, different qua.
Running head PURCHASING ORGANIZATION METRICS REPORT .docxjeanettehully
Running head: PURCHASING ORGANIZATION METRICS REPORT 1
PURCHASING ORGANIZATION METRICS REPORT 3
Purchasing Organization Metrics Report
Zachary T. Trigger
UMCG
Purchasing Management
Professor James Swaim
February 23, 2020
To obtain suppliers for the muscles from turkey legs, heart of pigs, alligator claws, corn leaves and Kelp from the Chesapeake Bay, the company would need to consider the various legal ramifications of purchasing. There is need for the company to routinely sign purchase orders and contracts which commit them to the specific terms and conditions of purchase orders and contracts. There are several essential elements of a purchase order and they include:
I. The two parties, both the company and the suppliers, must be capable of delivering
II. The subject of the matter must be legal and valid
III. There must be mutual consideration
IV. The parties must reach an agreement by offer and acceptance.
All four elements have to be present for the contract to be legal. If any of the elements is missing it makes the agreement unenforceable before a court of law.
The details of the purchase contract need to be well defined and it should not be carried out in a hasty manner. This is because, once the contract has been approved, there are no changes which can be accepted. In addition to the purchase contract, a purchase requisition should be made available as it specifies the required parts. This is important because the five items which are required by the company are part of a whole and hence the need for the purchase requisition. These contracts are aimed at binding the supplier and the company together and to provide security to the company for a source of their raw materials. Whenever the company requires the raw materials to be supplied, a purchase order has to be created. This provides a records of the details of the raw material to be supplied by the suppliers.
Several elements need to be clarified in the contract to ensure that there are no misunderstandings between the supplier and the company. The first is the quality of the raw materials that the suppliers will supply and this ensures consistency and surety of products the company receives. The second component highlights the cost of the raw materials, that is the price which the suppliers will supply the raw materials per unit. The duration before the raw materials are supplied should also be specified to allow the company to calculate the lead time and avoid running out of raw materials. Finally, the duration of payment should also be outlined in the contract to stipulate the time taken before payment is made.
REQUEST FOR PROPOSAL
Company name
Introduction
The company requests for proposals from qualified supplying firms to supply the raw materials required in the manufacture of products used in laboratory testing. For the production of the end product, different qua ...
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https://nidmindia.com/
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Understanding
AI-Generated Content:
AI-generated content includes text, images, videos, and audio produced by AI without direct human involvement. This technology leverages large datasets to create contextually relevant and coherent material, streamlining content production.
Key Benefits:
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Market Insights:
The content marketing industry is projected to grow to $17.6 billion by 2032, with AI-generated content expected to dominate over 55% of the market.
Case Study: CNET’s AI Content Controversy:
CNET’s use of AI for news articles led to public scrutiny due to factual inaccuracies, highlighting the need for transparency and human oversight.
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Conclusion:
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Connect with Us:
Follow Cut-The-SaaS on LinkedIn, Instagram, YouTube, Twitter, and Medium. Visit cut-the-saas.com for more insights and resources.
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2. OVERVIEWOVERVIEW
PurchasingPurchasing
Objectives of PurchasingObjectives of Purchasing
Principles of PurchasingPrinciples of Purchasing
Functions of Purchasing Department.Functions of Purchasing Department.
Methods of PurchasingMethods of Purchasing
Steps in Purchase Procedure.Steps in Purchase Procedure.
3. PURCHASINGPURCHASING
PurchasingPurchasing refers to a business or organizationrefers to a business or organization
attempting to acquire goods or services to accomplishattempting to acquire goods or services to accomplish
the goals of the enterprise.the goals of the enterprise.
All production firms have the need of supplies ofAll production firms have the need of supplies of
materials and services from external sources.materials and services from external sources.
Purchasing function may include the purchase of rawPurchasing function may include the purchase of raw
material, spare parts.material, spare parts.
The chief function of the Purchasing manager is toThe chief function of the Purchasing manager is to
satisfy the materials and supplies related tosatisfy the materials and supplies related to
requirements of other depts. This is done in accordancerequirements of other depts. This is done in accordance
with the mission, purpose, goals & objectives of thewith the mission, purpose, goals & objectives of the
firm.firm.
4. The key issues involved in purchasing are:-The key issues involved in purchasing are:-
QuantityQuantity
QualityQuality
TimeTime
PlacePlace
5. OBJECTIVES OF PURCHASINGOBJECTIVES OF PURCHASING
Purchase of satisfactory material.Purchase of satisfactory material.
Proper negotiations with suppliers.Proper negotiations with suppliers.
Co-ordination with other departments.Co-ordination with other departments.
Timely deliveries.Timely deliveries.
Continuous and regular supply.Continuous and regular supply.
Minimized wastages.Minimized wastages.
QualityQuality
To control the qty. of materialTo control the qty. of material
Information about new material and processes, which canInformation about new material and processes, which can
reduce the cost of production and improve the performance ofreduce the cost of production and improve the performance of
the product.the product.
7. FUNCTIONS OF PURCHASINGFUNCTIONS OF PURCHASING
DEPARTMENTDEPARTMENT
1.1. Processing theProcessing the
requisition:-requisition:-
Purchase requisitionPurchase requisition
No………. Date………..No………. Date………..
S.NoS.No QtyQty
ReqdReqd
Qty. andQty. and
OtherOther
details ofdetails of
the itemthe item
PricePrice SuggestSuggest
eded
SupplierSupplier
BalancBalanc
e ine in
storesstores
Required By……… Authorized By...…Required By……… Authorized By...…
8. 2.2. Location and Choice of suppliersLocation and Choice of suppliers:-:-
Some guiding factors for the choice of supplierSome guiding factors for the choice of supplier
Reliability of SupplyReliability of Supply:- Past performance specially:- Past performance specially
in the time of crisis as well as sound financialin the time of crisis as well as sound financial
position of a supplier classifies him to beposition of a supplier classifies him to be
reliable.reliable.
Assurance of timely deliveryAssurance of timely delivery
After sales serviceAfter sales service
Attitude with regard to the goods rejected by theAttitude with regard to the goods rejected by the
purchaserpurchaser
Technical assistanceTechnical assistance
9. 3.3. Placing orders:-Placing orders:-
All purchases should be made through a purchase order in
a specified form and duly signed by some authorized
person.
PURCHASE ORDER
To
_____________ Date……
Order No……
Description of item
PRICE
Date of Supply…… Other reqd’s
Signature…………….
10. As a rule original copy is sent to the supplier,As a rule original copy is sent to the supplier,
one copy is retained by the purchase departmentone copy is retained by the purchase department
and one copy is sent to the concernedand one copy is sent to the concerned
department requiring the ordered items.department requiring the ordered items.
11. 4.4. Follow-up or progressing the purchaseFollow-up or progressing the purchase
orders:-orders:-
Receiving the ordered material at the right timeReceiving the ordered material at the right time
is most important for an org. Late deliveries canis most important for an org. Late deliveries can
close the enterprise. For this follow up theclose the enterprise. For this follow up the
purchase order after waiting for some reasonablepurchase order after waiting for some reasonable
time is essential. The priority of follow-uptime is essential. The priority of follow-up
operations should be given according to theoperations should be given according to the
importance or classification of items e.g. ‘A’importance or classification of items e.g. ‘A’
class items are to be given top most priority.class items are to be given top most priority.
12. 5. Invoices received from suppliers are checked and5. Invoices received from suppliers are checked and
verified with order specificationverified with order specification
6. Delay in availability of requisitioned material should6. Delay in availability of requisitioned material should
be conveyed to concerned departments in time.be conveyed to concerned departments in time.
7. To maintain records regarding suppliers , their7. To maintain records regarding suppliers , their
performance in past, products with them, probableperformance in past, products with them, probable
delivery period for each order etc.delivery period for each order etc.
8. To dispose off outdated and scrapped items.8. To dispose off outdated and scrapped items.
9. Control stores operation of receiving the items from9. Control stores operation of receiving the items from
vendors and issuing it to concerned department ofvendors and issuing it to concerned department of
the organisation.the organisation.
10. To handle damages and demurrage claims.10. To handle damages and demurrage claims.
13. 1.1. Purchasing according to requirements.Purchasing according to requirements.
2.2. Purchasing for some definite future period.Purchasing for some definite future period.
3.3. Market Purchasing.Market Purchasing.
4.4. Speculative Purchasing.Speculative Purchasing.
5.5. Contract Purchasing.Contract Purchasing.
6.6. Scheduled Purchasing.Scheduled Purchasing.
METHODS OF PURCHASINGMETHODS OF PURCHASING
14. PURCHASING ACCORDING TO THEPURCHASING ACCORDING TO THE
REQUIREMENTS:REQUIREMENTS:
This method is appropriate for those items which areThis method is appropriate for those items which are
not of regular and common use in the productionnot of regular and common use in the production
process. These items are generally not stored inprocess. These items are generally not stored in
inventories. And Purchasing department should keep ainventories. And Purchasing department should keep a
record of reliable and trustworthy suppliers who wererecord of reliable and trustworthy suppliers who were
sincere to the organisation in pastsincere to the organisation in past..
15. PURCHASING FOR SOME DEFINITEPURCHASING FOR SOME DEFINITE
FUTURE PERIOD:FUTURE PERIOD:
This method of purchasing is generally used for thoseThis method of purchasing is generally used for those
items, which are regularly consumed, but theitems, which are regularly consumed, but the
consumption is comparatively low and the priceconsumption is comparatively low and the price
changes for these items are not much.changes for these items are not much.
16. MARKET PURCHASINGMARKET PURCHASING::
Purchase of goods usually in smaller quantities or in anPurchase of goods usually in smaller quantities or in an
emergency without contract or negotiationsemergency without contract or negotiations..
17. SPECULATIVE PURCHASINGSPECULATIVE PURCHASING::
When purchasing is done purely from the point of viewWhen purchasing is done purely from the point of view
of taking advantage of a speculated rise in price of theof taking advantage of a speculated rise in price of the
commodity.commodity.
The intent is not to buy for the internal consumptionThe intent is not to buy for the internal consumption
but to resell the commodity at a later date when thebut to resell the commodity at a later date when the
prices have gone up & to make a profit by selling.prices have gone up & to make a profit by selling.
The items may be those that are needed for internalThe items may be those that are needed for internal
consumption but the qty. shall be much more than theconsumption but the qty. shall be much more than the
requirement so as to take the advantage of the comingrequirement so as to take the advantage of the coming
price rise.price rise.
18. CONTRACT PURCHASING:CONTRACT PURCHASING:
In this, the purchase department enters into agreement withIn this, the purchase department enters into agreement with
various suppliers to supply the items at some future periodvarious suppliers to supply the items at some future period
periodically.periodically.
In contract purchasing, a purchaser agrees to buy goods to beIn contract purchasing, a purchaser agrees to buy goods to be
paid for in a series of installments, each comprising a proportionpaid for in a series of installments, each comprising a proportion
of the capital and an interest element.of the capital and an interest element.
After a final payment, legal ownership passes to the user.After a final payment, legal ownership passes to the user.
19. SCHEDULED PURCHASINGSCHEDULED PURCHASING::
The purchasing is scheduled according to theThe purchasing is scheduled according to the
requirements of the various departments or of therequirements of the various departments or of the
organisation.organisation.
20. STEPS IN PURCHASE PROCEDURESTEPS IN PURCHASE PROCEDURE
1.1. Various departments are requested to send their requirementsVarious departments are requested to send their requirements
on a proper requisition form.on a proper requisition form.
2.2. Purchasing dept. consolidated the requirements from variousPurchasing dept. consolidated the requirements from various
departments to know the total requirement for each item.departments to know the total requirement for each item.
3.3. Market exploration is made to locate the goods and services ofMarket exploration is made to locate the goods and services of
desired quality and quantity at the reasonable price.desired quality and quantity at the reasonable price.
4.4. Potential suppliers are identified from catalogues, quotationsPotential suppliers are identified from catalogues, quotations
and past records.and past records.
5.5. Purchase order in specified form is prepared and sent to thePurchase order in specified form is prepared and sent to the
approved suppliers. Purchase order is the commitment of theapproved suppliers. Purchase order is the commitment of the
buyer to the supplier establishing a contractual relationshipbuyer to the supplier establishing a contractual relationship
between buyer and seller.between buyer and seller.
21. 6. After some time of placing the order, follow up6. After some time of placing the order, follow up
process starts to get quickly delivery of the items.process starts to get quickly delivery of the items.
7. Items received are compared with purchase order.7. Items received are compared with purchase order.
8. Defective items i.e. items which are not in8. Defective items i.e. items which are not in
accordance with the specifications laid down in theaccordance with the specifications laid down in the
purchase order are returned to the supplier onpurchase order are returned to the supplier on
credit note of exchange.credit note of exchange.