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Steps to Ensure a Successful Procurement Process

Steps to Ensure a Successful Procurement Process

Procurement is the act of obtaining and purchasing goods, services or any form of works from an external source mostly through tendering or bidding processes. The goods, services or works have to be of high quality and procured at a very good cost that optimizes the needs of the company or firm. The process of acquiring the goods or services is achieved through various steps that make up the procurement life cycle.

Need Determination

As a procurer for a certain company, it is an internal requirement for the company to start by identifying its needs. This is mostly achieved by developing a short term strategy that involves defining the goals that are to be achieved within the period let us say 3-5 years. The direction or path to be followed and the requirements needed to attain these goals are identified.

Identify the Right Supplier

After considering important aspects such as whether to make or buy goods and services, whether to use a single or multiple suppliers; the next step is to establish the perfect supplier for the required goods and services. An online search could be used, referrals or trade shows. As the lead procurer, ensure that the supplier selected is one you can work with appropriately without collisions.

Supplier Communication

After identifying the right supplier or supplier, the next thing is to ensure that sufficient communication is done about quotations, proposals, information or tendering requests. You could make use of advertisements where numerous suppliers are involved or simply direct communication where a single supplier is concerned.

Negotiation

Negotiations have to be done to determine the price margins, goods availabilities and the possibility of customizing particular goods and services.

Supplier Liaison

Here the company does an evaluation on the P/S and the accompanying service support. This could be done using a supplier scorecard. The contract will expire only after the P/S has been consumed or disposed of, saving room for reordering.

Management of Logistics

During this stage, supplier preparation, expediting, shipment and delivery and finally payment are completed by the binding contract terms. The services could extend to the installation of products and training of personnel on how to use the products.
All in all, the above cycle is just a representation of an appropriate channel to ensure a successful procurement process. It is important to possess good interpersonal skills so as to be able to relate well with other firms and procure the best quality products and services.

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