Question

List and identify four key stages in the development of procurement

Answer 1

Procurement Process- It is a wide process, it involves the purchasing decision that is taken from identification of need to purchase to final purchase. It involves choosing vendors, establishing the payment terms, negotiations and actual purchasing.

Stages in procurement process- Are as following:

Identification of Need and searching for alternatives- This is the very first step of procurement process, in which need of purchasing is recognized and for fulfilling that need, alternatives are searched.

Searching for suppliers and vendors- Suppliers and vendors are contacted and negotiated for buying the goods, payment terms are decided. Delivery of goods, time of delivery etc. everything is decided.

Making purchase- Purchase is finally made after giving the purchase order. Company can accept or reject the goods if it is not up to the mark. Company should cross check the invoice and purchase order. If there is any discrepancy, it should be resolved before final payment

Follow up- The task is not completed till purchasing, after the purchase and delivery of goods, all lots and goods are checked, if there is any wear and tear then goods return takes place. Company has to record all the delivered goods and subtract the goods return, company also records the payment that is made and the balance also.