Purchasing management

Purchasing management is The management of purchasing process, and related aspects in an organization. Because of production companies purchase nowadays about 70% of their turnover, and service companies purchase approximately 40% of their turnover.

 purchasing management is one of the most critical areas in the entire organization and needs intensive management. Purchasing management also covers the areas of outsourcing and insourcing. Models used to aid purchasing managers include the Newsboy model as well as the Order up To (OUT) model.

Objectives
To maintain uninterrupted flow of materials to support the development schedules. To procure materials economically at a cost consistent with the quality and service required. However, generally all purchases may be attempted at the lowest cost. To provide the necessary expertise, advice, information to the Curators and Education Officers with regard to the best quality of material available in the market, suppliers capability and performance etc. To develop and maintain good buyer-seller relationship. To promote source development. To maintain Organization reputation and credibility in the market by fair dealings and prompt payments.

Responsibility of P.D
Procurement of stores through indigenous and foreign sources as required in accordance with the rules in force. Checking of requisitions/purchase indents. Selection of suppliers for issue of enquiries. Issuing enquiries/tenders and obtaining quotations. Analyzing quotations and bids etc., and preparation of comparative statement (quotation charts). Consultation with the Indentor for selection and approval of quotations and with Accounts Officer for pre-audit. Negotiating contracts. Checking legal conditions of contracts. Consulting Administrative Officer or Secretary, of the organization where necessary. Issue of Purchase Orders.

 Follow-up of purchase orders for delivery in due time Verification and passing of suppliers bills to see that payments are made promptly. Correspondence and dealing with suppliers, carriers etc., regarding shortages, rejections etc., reported by the Stores Department. Maintenance of purchase records. Maintenance of progressive expenditure statement, sub-head wise. Maintenance of vendor performance records/data. Arrangement for Insurance Surveys, as and when necessary. Clearance of foreign consignments.

Purchasing cycle
Need for Procurement Scrutiny of purchase indent Purchase Market research Order preparation Follow up with suppliers Receiving and Inspection Storage and record keeping Invoicing and payment

Negotiation and Bargaining

Negotiation and bargaining is a process in which two or more parties seek a mutual agreement through an explicit or implicit exchange of views.