PURCHASE MANAGEMENT

• All the organization needs require efficient and economic purchasing and procurement of its various supplies of materials from the supplier.

OVERVIEW

PRINCIPLES

OBJECTIVES

FUNCTIONS

PROCEDURES

SOURCES

PRINCIPLES

Purchasing

Principles

Right Quantit

y

Right Quality

Right Price

Right Source

Right Place

Right Time

OBJECTIVES

Maintaining the continuous supply to support production

Doing minimum investment in stores and materials inventory

Avoiding costly delays and wastage of purchased items

OBJECTIVES

Maintaining quality standards based on suitable criteria

Procuring the materials at the lowest possible cost

Ensuring sound customer supplier relationship

FUNCTIONS

Requisition of materials to initiate to initiate the purchase

Selection of proper suppliers

Negotiation for the cheapest possible price with the suppliers

FUNCTIONS

Ensuring the quality of materials without compromising with the cost

Purchasing the materials of right quantity and quality at the right time and cheapest price

Setting the proper purchase policies and procedures

PROCEDURES

Ascertaining the need and recognition of it.

Accurate statement of specifications, character, quality and quantity requirements with full descriptions.( Requisition form)

Transmission of the purchase requisition.

Negotiation with the possible sources of supply.

Analysis of the proposal, determination of the price, availability and delivery time.

PROCEDURES

Selection of the vendor and placement of the supply order and purchase order.

Expediting and follow up.

Arranging for receipt, inspection, replacement of the rejected and defective materials and goods.

Checking of invoices and bills payable.

Completion of records and files.

SOURCES

Past experience with the supplier

Interview with salesmen

Technical and descriptive catalogues

Trade directories and trade journals

SOURCES

Visits to trade fairs

Consulting trade agencies

Open and limited tenders for quotations

Periodical advertisements in the press

Prepared By :

Rohit Kochhar