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    Procurement 06052019

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    Venkatesh
    This document defines and explains the key concepts and processes involved in procurement. It discusses: 1. The meaning of procurement as the process of obtaining goods and services, including preparation, demand processing, receipt, and payment approval. 2. The main stages of the procurement process, including purchase planning, supplier selection, specifications development, price negotiation, purchase completion, and contract administration. 3. What types of items procurement deals with, such as raw materials, finished goods, spare parts, assets, and services. 4. Key considerations for procurement like lead time, storage capacity and safety, minimum stock levels, and demand. 5. The differences between direct procurement of raw materials versus indirect procurement of

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    Procurement 06052019

    Uploaded by

    Venkatesh
    335 views14 pages
    This document defines and explains the key concepts and processes involved in procurement. It discusses: 1. The meaning of procurement as the process of obtaining goods and services, including preparation, demand processing, receipt, and payment approval. 2. The main stages of the procurement process, including purchase planning, supplier selection, specifications development, price negotiation, purchase completion, and contract administration. 3. What types of items procurement deals with, such as raw materials, finished goods, spare parts, assets, and services. 4. Key considerations for procurement like lead time, storage capacity and safety, minimum stock levels, and demand. 5. The differences between direct procurement of raw materials versus indirect procurement of

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    This document defines and explains the key concepts and processes involved in procurement. It discusses: 1. The meaning of procurement as the process of obtaining goods and services, including preparation, demand processing, receipt, and payment approval. 2. The main stages of the procurement process, including purchase planning, supplier selection, specifications development, price negotiation, purchase completion, and contract administration. 3. What types of items procurement deals with, such as raw materials, finished goods, spare parts, assets, and services. 4. Key considerations for procurement like lead time, storage capacity and safety, minimum stock levels, and demand. 5. The differences between direct procurement of raw materials versus indirect procurement of

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    335 views14 pages

    Procurement 06052019

    Uploaded by

    Venkatesh
    This document defines and explains the key concepts and processes involved in procurement. It discusses: 1. The meaning of procurement as the process of obtaining goods and services, including preparation, demand processing, receipt, and payment approval. 2. The main stages of the procurement process, including purchase planning, supplier selection, specifications development, price negotiation, purchase completion, and contract administration. 3. What types of items procurement deals with, such as raw materials, finished goods, spare parts, assets, and services. 4. Key considerations for procurement like lead time, storage capacity and safety, minimum stock levels, and demand. 5. The differences between direct procurement of raw materials versus indirect procurement of

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    PROCUREMENT

    Meaning:
    The act of obtaining or buying goods and
    services. The process includes preparation
    and processing of a demand as well as the
    end receipt and approval of payment.
     The process of procurement is often part of a
    company's strategy because the ability to purchase
    certain materials will determine if operations will
    continue.
    1. purchase planning,
    2. standards determination,
    3. specifications development,
    4. supplier research and selection,
    5. value analysis,
    6. financing,
    7. price negotiation,
    8. making the purchase,
    9. supply contract administration,
    10. inventory control and stores,
    11. disposals and other related functions.
    Procurement Deals with
    1. Raw Material
    2. Semi Finished Materials.
    3. Finished Materials
    4. Spare Parts
    5. Assets
    6. Services
    7. Trading
    8. Sub Contracting
    1. Lead Time.
    2. Capacity of Yard/Stores/Warehouse
    3. Safety Of Stock
    4. Minimum Stock Level Maintenance
    5. ROP(Re Order Point)
    6. Demand
    Direct Purchases:
    Direct procurement is the act of acquiring raw
    materials and goods for production. These purchases
    are generally done in large quantities, acquired from a
    pool of suppliers at the best possible cost, quality
    and reliability.
    In Direct Purchases:
    Indirect procurement is the act of purchasing
    services or supplies required to keep the day to day
    business alive. One way of classifying indirect
    procurement is that it does not add to a business’s
    bottom line. This includes things such as repairing
    equipment, buying office supplies or acquiring
    services.
    PROCURE 2 PAY (P2P)
    P2P connects procurement through to payment of
    goods. The purchase to pay process, also known as
    the P2P process, connects the procurement and
    entire supply chain processes within a company
    through the goods receipt process, and finally to the
    payment issued to the vendor.
    PROCURE 2 PAY (P2P) CYCLE

    Purchase Request Request for


    Quotation Finalize the Quotation
    Purchase Order Goods Receipt
    Invoice Verification Vendor Payment.
    Vendor Analysis
     1. Analyze your business requirements,

     2. Search for a vendor,

     3. Write a Request for Proposal (RFP) & Request for

    Quotation (RFQ),

     4. Evaluating the proposal & selecting the vendor,

     5. Creating a contract negotiation strategy,


     Consignment Stock :
    Supplier provides materials and stocks them in
    the purchaser's premises. The material remains
    in the books of the supplier (vendor) until the
    same is withdrawn from the stock of the
    Consignment and put to use.

    When we are consuming the stock then only


    Payment made to Vendor as per Purchase
    agreement Rules.
    Sub Contracting:
     If not having the capability of Specific Operation
    that time approach the sub Contracting for demand
    of the Operation.
    Blanket Purchase:
    • A blanket purchase order (BPO) is a long-term
    agreement between an organization and a supplier to
    deliver goods or services with a set price on a
    recurring basis over a specified time period. If your
    business makes multiple payments for the same goods
    or services, issuing a blanket purchase order with the
    details, such as price and delivery schedule, already
    specified is an efficient way to reduce time spent and
    processing delays.
    Physical Inventory:
     Check (Or) Count the Stock in hand in Physically
    against the Bin Card wise.
     Physical Inventory Checking is a continuous Process
    for all the Org and.
     Based on Volume of the Product check the Quantity
    Period or cycle wise in a year
    Scrap:
     A small piece or amount of something,
    especially one that is left over after the greater
    part has been used.
    Stock Transfer
    Stock Transfer nothing but transferring of materials from one
    plant to another Storage location , from Plant to Plant, from
    Plant to warehouse, warehouse to branches, when the stock
    transfer happens between plants, then the Quantity changes
    in both Plants.
     Cost Center:

    “Where we are invest the money that is


    called cast center”

    Thank you
    Thank you

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