Question

Being a first line manager of telecom Company, you are required to make a proposal for purchasing six new 1300cc cars for office use. Elaborate, with working, the steps you will follow to take rational decision for purchasing the most suitable cars.

Answer 1

Being in the purchasing department or administration department we have to come across this type of purchase which requires analyzing the best option to finalizing the purchase. As this question is regarding the purchase for an organization we need to ensure that all the steps are taken care of as this involves budgeting and we are responsible to answer the questions.

Below are the steps that need to be considered while making a purchase.

Research Car Option: First we need to ensure the purpose that w are going to purchase. If this is going to be used for transporting employees or only used for the transport of managers or higher officials. This will make us clear about the type of purchase as this requires features that need to be added or extra care that need to be taken. We also have to look at Safety, Size, and reliability.

Funding: To ensure if this is funded directly by the organization budget or we are going to procure this from the finance option available. If financing we have to consider the rate of interest charged by the authorities and we have to check for the various other options available.

Leasing: If we are purchasing this for a temporary project we have to check if this can be leased as this includes the maintenance charges and driver facilities provided by the leasing company. We should also check if leasing is helpful than purchasing by doing the cost comparison.

Maintenance: We also have to plan for the costs that are going to be incurred after the purchase as we know we have to go for maintenance charges. Planning should be done accordingly.

By considering all these we arrive at a point which has listed benefits and we can proceed with the options available in the market.