The acquisition of services and products is both a science and an art. Every company’s management should be familiar with the process of corporation procurement. Even if it’s just generally purchasing from another company, there should be basic steps from beginning to end. This systematic approach fosters organization and responsibility among other corporations and small businesses. Funding is the most important aspect that should be responsibly handled, whatever status of economy the company is in.
Larger corporations also need smaller companies to go through their projects and manufacturing endeavors. Doing business with them saves a lot of money and labor. If done right, corporation procurement will be profitable for both the parties.
The Process of Corporation Procurement
In every process, there has to be proper discernment and rationalization. These are essential in the following steps that comprise corporation procurement:
1. Recognizing needs
The corporation has to know what it needs, whether it’s a product or service. It may be something that has been acquired in the past or perhaps a new item/service to be procured. In the part of the small business that acts as the resource, there should be proper matching of the needs and the available products or services. When the needs are presented on the table, then everyone gets a chance to be fulfilled.
2. Needs specified
Specifications of the needed services or products are vital. Codes or numbers are a big help in the specificity of the service or product. If these are lost or unknown, weight, color, or texture could be used for proper identification.
3. Options in sources
Where the company gets the service or product has to be determined well. A prepared and approved list of vendors could help in this aspect. However, if there aren’t any lists of vendors made, research for the most ideal source company can be made via the Internet, sales representatives, magazines, or newspapers. If the company finds a roster of new companies that they feel could supply them with the services or products that they need, then it’s up to them to qualify the potential suppliers.
4. Terms and Price
Proper investigation of the terms and prices for the products should be done by the corporation. It’s common for a corporation to evaluate three potential suppliers before it makes a decision.
5. Order
The purchase order contains the specifications, price, and conditions of the purchase.
6. The Delivery
Proper delivery of the purchase order should be made –hand delivered, e-mail, fax, or snail mail.
7. Expediting Process
The purchase order should be expedited so that the time of delivery, date of payment, and completion of work will be noted.
8. Receiving and Inspecting
Once the products are thoroughly inspected, they will be properly received.
9. Payment of Approved Invoice
The invoice should have the original purchase order and the invoice so that the payment can be approved and made. Discrepancies should be discussed in this step.
10. Records Keeping
Proper records keeping should be implemented. The records included here are purchase orders and tax information as well. These will be good references for future references.
Corporation procurement is a valuable opportunity to get to know both vendors and corporations. Once done properly, there is a high probability that the contract will be renewed with the small business supplier.
Now, how does corporation procurement benefit you? Or how would you like corporation procurement to do you good? Share your thoughts.
Also check out this fantastic ebook on corporate procurement today and receive the most up-to-date information on this highly essential business booster!
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