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Step 1: Need Recognition This is a seemingly obvious step, but one that needs
to be mentioned. A business owner (or procurement department) must recognize a
product is needed in order to purchase it. That product can be either a brand new
item, or one that is being re-ordered.
Step 2: Specific Need Does your industry have specific requirements for various
products. If that is the case in your industry, be sure you are up-to-date on those
requirements and order accordingly.
Step 3: Source/Examine Supplier Options Every business needs to determine
where to get their goods. Some companies have an approved vendors list (this is a
recommended practice) while others are still trying to determine who the best
suppliers are. Once a supplier is chosen, companies should stick with that
relationship and try to establish preferred pricing.
Step 4: Price and Terms Once a supplier is chosen, companies should stick with
that relationship and try to establish preferred pricing and specific terms (i.e.
delivery).
Step 5: Purchase Order The purchase order is used the formal contract used to
buy the product. The purchase order outlines the price, specifications and terms and
conditions of the product or service and any other additional obligations.
Step 6: Delivery The transfer of the purchase order via email, mail or fax (email
is highly recommended).
Step 7: Expediting This stage addresses the timeliness of the service or
materials delivered. Delays, for many businesses, are important. The purchase
order will have expected delivery date information.
Step 8: Receipt and inspection Once delivered, the receiving company inspect
and, subsequently, accepts or rejects the product. Rejection is almost always due to
a damaged product.
Step 9: Invoice Approval and Payment At this stage, three documents must
match when the seller wants payment the invoice, the receiving document
(attached to the product) and the original purchase order. This is known as threeway matching. If there is a discrepancy, it must be resolved before payment is
made.
Step 10: Record Keeping The receiving (buying) company must keep good
records. This means saving all relevant documents for every completed purchase.
How can e-procurement help?
An e-procurement solution can be a significant source of help in various stages of
the procurement process. For instance, an e-procurement solution will electronically
generate purchase orders, with all of the requisite information.
Also, an e-procurement solution is a critical tool when it comes to delivery and
record keeping. With an e-procurement solution, all purchase orders will be sent
electronically in the system (an email notifying all parties will be sent as well),
ensuring delivery is completed immediately.
Finally, an e-procurement solution will catalogue every transaction in the system,
ensuring your records are kept up-to-date. Those records are of critical importance
for financial forecasting, or in the vent of an audit.
The benefits of an e-procurement system like Procurify extend to each stage of the
procurement process. Stream line your purchasing and procurement processes,
reduce employee headaches, eliminate annoying paperwork. Switch to an eprocurement system like Procurify today!
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Procurement Specialist
Job Summary
The Procurement Specialist ensures that the items and services to build and maintain our
advanced oilfield technology products are purchased from specified suppliers and are delivered
according to agreed terms and conditions. An important aspect of this role is seeking maximum
value for the company through time and cost agreements while working with technology
advanced products.
Essential Responsibilities and Duties
Interfaces with Product Line Planning Manager to plan and prioritize purchasing
activities.
Reviews planned orders, creates requisitions for purchased items, and manages approval
process.
Transmits and prioritizes approved purchase orders and supporting documents to supplier.
Tracks order acknowledgement, prepares and communicates shortage and backlog
reports, and provides visibility of potential interruptions to internal customers.
Tracks orders and confirms system lead times, delivery dates, and costs.
Reviews, updates, and maintains purchase orders until they are closed.
Ensures orders adhere to supplier agreements and contracts; reports nonconformances.
Leads finance and logistics staff in resolving reception and invoice discrepancies.
Identifies opportunities and implements actions to achieve efficiencies.
Contributes to consolidation, reduction, and rationalization of the local supplier base.
Qualifications
Masters or bachelors degree in fields of supply chain, engineering, or manufacturing.
1. Accidental Orders
Did you order the wrong item? Or the wrong quantity? If you have a good relationship with your
supplier, immediately follow up to admit the mistake and rectify the order. This can save you
from considerable hardship in the long run. Given the speed of transactions these days, these
types of ordering errors are still common, but they do raise concerns about the checks and
balances that exist in your supply chain. Adopting a protocol that allows for approval from more
than one person is one safeguard against mistakes like this in the future.
2. Inflexible Suppliers
Many procurement decisions correlate to a companys risk management strategy: the lower the
costs, the better theyre reflected on the bottom line. Most suppliers who recognize that will
accommodate a purchasing companys needs to maximize their performance. Still, some
suppliers may not offer discounts or insist that certain surcharges be included in the price. Before
opting for rigid supplier, consider other negotiation options. Can the supplier pay for shipping?
Are discounts available in larger bulk orders? A skilled procurement professional like yourself
will often find some wiggle room for negotiation and youll look good doing it.
3. Exceeding Budget
Chances are, procurement transactions that exceed your budget arent due to reckless spending if
you have your companys well-being in mind. Its more likely that a communication (or
coordination gap) is present in your procurement protocol and should be addressed as soon as
possible. Regular budgetary updates affecting the financial status of all links in your supply
chain, including budgetary changes, will go a long way towards rectifying that problem.
4. Damaged Goods
Impulse buying, making emotional decisions based on preference of suppliers and literally
phoning in an order are often the most common causes of procurement errors, especially if the
company is a rapidly growing startup. When a company launches, decision-makers usually want
to ensure everything is ordered and in place all at once. Hitting the ground running often means
ignoring the cautionary steps in a procurement process and may result in cost overruns in
inventory before revenue streams can compensate for these purchases. A good, comprehensive
procurement system allows for both prompt orders and more thoughtful decision-making.
Thought it takes time upfront (and okay, you caught us, implementing a procurement process
isnt an easy fix), it will save you a ton of work in the long run.
5. Rushed Purchases
If your delivered order is damaged in any way, you have the option to refuse the delivery or
accept the items but clearly indicate the condition of the shipment, you are the customer after all.
Depending on who paid for freight, you must notify the courier and supplier immediately and
negotiate who is responsible for compensating your company. Bear in mind that if the items were
damaged during transport and if your company paid for the freight, the responsibility no longer
rests with your supplier, but with the courier. Consider having a variety of couriers on deck in
case one doesnt work out. Also, always be sure to report any discrepancies as soon as possible to
expedite solutions with either your supplier or courier.
Since most procurement problems can be attributed to human error, these issues can usually be
resolved fairly easily. Make sure that your procurement system takes these mistakes into account
and ensure your partnership with a supplier is based on mutual understanding. The more
safeguards that are in place, the less of an effect these type of errors will have on your companys
procurement ability.