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Faizan
You may know, procurement, now often referred to as supply management is a process that involves purchasing goods and services, goods and services that are essential for the activity of the company. As simple as this definition may be, procurement is a very complex act, consisting of planning, preparation, demand processing, receipt and payment.
The very first stage of procurement is purchase planning, followed by the determination of standards and development of specification. After that, and experienced procurement expert will research various national and international suppliers and make an informed selection. Next, a value analysis will be made, the price will be negotiated and finally, the purchase will be made. However, the procurement process doesn't stop there, because the final three stages are supplying the contract administration, doing the store and inventory control and doing disposals.
The importance of the procurement process lies in the fact that it's a crucial part of any company's strategy, no matter if the business needs goods in order to create their own products or in order to resell them to their customers. The ability to obtain certain materials and/or services determines whether the company's operations will continue. From this point of view, the price negotiation stage of the procurement process is very important, because the price of the goods or services that are procured for the company must not exceed the price of the finished product, because that would mean that the company is counterproductive and will eventually go bankrupt.
As we said before, procurement is a quite complex act and given the fact that we are in an era of fast product cycles, high competition on a global level and a greater risk of supply chain disruption, many businesses are starting to realize that they can't manage it on their own. That is why procurement companies are starting to gain more and more popularity in the business field.
Starting a collaboration with a procurement company means understanding that the procurement process (or supply management) can be used as an important competitive advantage, as long as it is being handled by experts. The fact is that purchasing accounts for more than half of the overall costs of a company in a lot of industries, meaning that making procurement mistakes means losing a lot of money.
Working with a procurement company means cutting the costs of an entire department of your company, cutting back on the workload and in the same time bringing great leadership, experience, a new perspective and the ability to develop and provide effective supply chain solutions.
By doing that, you will grow your reputation and keep long term collaborations with your customers, by offering them what they need, when they need it and at a great quality.
The very first stage of procurement is purchase planning, followed by the determination of standards and development of specification. After that, and experienced procurement expert will research various national and international suppliers and make an informed selection. Next, a value analysis will be made, the price will be negotiated and finally, the purchase will be made. However, the procurement process doesn't stop there, because the final three stages are supplying the contract administration, doing the store and inventory control and doing disposals.
The importance of the procurement process lies in the fact that it's a crucial part of any company's strategy, no matter if the business needs goods in order to create their own products or in order to resell them to their customers. The ability to obtain certain materials and/or services determines whether the company's operations will continue. From this point of view, the price negotiation stage of the procurement process is very important, because the price of the goods or services that are procured for the company must not exceed the price of the finished product, because that would mean that the company is counterproductive and will eventually go bankrupt.
As we said before, procurement is a quite complex act and given the fact that we are in an era of fast product cycles, high competition on a global level and a greater risk of supply chain disruption, many businesses are starting to realize that they can't manage it on their own. That is why procurement companies are starting to gain more and more popularity in the business field.
Starting a collaboration with a procurement company means understanding that the procurement process (or supply management) can be used as an important competitive advantage, as long as it is being handled by experts. The fact is that purchasing accounts for more than half of the overall costs of a company in a lot of industries, meaning that making procurement mistakes means losing a lot of money.
Working with a procurement company means cutting the costs of an entire department of your company, cutting back on the workload and in the same time bringing great leadership, experience, a new perspective and the ability to develop and provide effective supply chain solutions.
By doing that, you will grow your reputation and keep long term collaborations with your customers, by offering them what they need, when they need it and at a great quality.
Posted in: business
