14 Apr Procurement – The Process walk through
Procurement is the foundation stone of every business, or, to be more precise, it’s like the fuel to an Engine. We often mistake purchasing for Procurement, whereas purchasing is just one rung of the long ladder of Procurement.
Procurement is strategic planning to obtain cost-efficient raw material, products, or services for a business at the right time.
The process of procurement includes identifying needs, finding the best vendors, and making the final purchase. It also ensures the quality, quantity, and adequate flow of the resources to keep the business running. In simple words, procurement is to manage the process of buying goods for an organization on a large level.
Let’s understand the process of Procurement in these simple steps:
1. Spotting the Gap
In a business, Gap is equal to ― Resources available – Resources required. The procurement team keeps a check of the stocks or thresholds of the raw materials required. A need can arise in these scenarios: Exhaustion of the previous stocks or Business Expansion. Therefore, the procurement team has to take care of the new orders as well.
2. Vendor Hunt
After determining the specific amount of resources required, the next step is to find the best supplier/seller or bidder. You may want to consider dealing with your existing vendors if they can fulfill the requirements. If not, go and start looking for your potential service providers. Things to keep in mind while dealing with your prospects-
- Speed of delivery
- Quality of the product
The number of suppliers can vary depending on the size of the demand. With more vendors, it is easy to keep the flow running. Having more options helps you compare the quality and cost of the products with others.
3. Finalizing the orders
The next step is to make the orders. Before making the orders, negotiate the cost and set the deadlines. In the case of vendors, make small orders to check the quality of the product and speed of service. If the product meets all the parameters, go for the final purchase.
To deal with tenders or contractors, finalize the bids very carefully as per the terms and conditions. The qualified applications need to be sent to the concerned department for approval. After the approval, jump in to start dealing with them.
Payment is the last step of the process. Examine the received orders for the quality and marked quantity. This also requires other departments of a company to check the product and approve the bills. Finally, the bills go to the accounting team.
How can SultanRM help?
SultanRM is an external provider of these services primarily to the public sector.
Conventional EPCM services include engineering, procurement, and construction management contracts offering standard services to several industries such as mining, petrochemical, and powered plant industries.
SultanRM, on the other hand, has arrived to expand and develop the current contracting strategies and advance into multi-discipline fields, primarily the government and public sector.
Our core business specializes in service delivery including:
- Mixed economy sourcing
We offer project management consultancy that is flexible enough to accommodate small-scale through to multi-million-pound projects.