Procurement processes are an essential and inseparable part of a business, organization or enterprise – small or large. Simply put, a procurement process means the chain of operations that are undertaken to provide the organization or business with an inventory of products required for its ongoing operations, as well as managing this inventory in the most optimal and efficient manner. A procurement process can be complex, as it often involves different departments and divisions within the organization, and work must be done in coordination and consideration of the overall procurement image. Sometimes, organizations prefer to use the services of a procurement company that specializes in the field and is experienced in streamlining procurement processes.
The procurement management chain has to be very effective, taking into account quality factors (for example – whether the organization or business actually receives the best goods) and, of course, economic factors (whether the prices paid by the organization in exchange for these goods – are the most optimal for it). In any case – whether you work in a family law firm or a large high-tech firm – procurement should be done to the best of your ability.
Most often, the procurement processes in an organization or business are carried out by a person or department specifically appointed to do so; Procurement workers often have academic education in fields such as logistics, economics, industrial engineering and management, and have relevant skills – order and organization, negotiation ability, accuracy and detail, and more. These employees have a great deal of responsibility, and when a purchase demand is raised by any department or department in the organization – they are the first you turn to.
Steps in purchasing chain management:
- Receiving the purchase request – An internal document detailing the required purchase, its components and the existing budget in the organization for its benefit. The document is obtained from procurement personnel from various entities in the organization when services or products are needed.
- Finding suppliers who can provide the best and highest quality products or services.
- Negotiation Management – To conclude with the supplier the terms of the transaction.
- Order – with details of the product or service purchased, the date of delivery and the price agreed upon.
- Control – Check the products that have arrived as well as confirm payment to the supplier.
As you can see, the procurement process is complex; There is a high chance of mistakes, non-quality orders and deals that will not benefit the organization in the short or long term. Therefore, improving procurement processes is an important goal that should be at the forefront of any organization or business – since an effective procurement process is of enormous importance to the success of the business and its ongoing work. In order to improve procurement processes in your organization or business, you can take several steps that will benefit the business and lead it to success and streamline in all areas.
Steps to improve procurement processes in an organization or business:
- Computing and automating the procurement process (or part of it) will help you reduce your load on the employee and reduce costs. It's about using different software that will "work for you" and manage some of the process components for you. For example, inventory management software in a furniture store, supermarket, or high-tech company. On the other hand, keep in mind that supervision and control is still needed, and you will always prefer one or more employees who check that everything is working properly when using the software itself.
- Shortening time range with suppliers. The more time you spend negotiating, contracting and negotiating with suppliers – the delivery time to the business will be delayed, and so will the rest of the work. If you employ an employee who is skilled in negotiation and who is familiar with the various suppliers and the nature of their products – you can streamline the process and shorten the times. Remember, the negotiation process does not only include the discourse with the supplier, but even earlier – it is necessary to find the appropriate supplier, to choose the way of dealing with it and so on. In addition, the relevant employee must be well acquainted with the product the organization or business needs in order to know exactly what it wants to get from the supplier.
- As mentioned, many businesses and organizations choose to utilize outsourcing services – that is, to contact procurement companies such as Sagiv Solutions, which performs and streamlines procurement processes, thus leading to better functioning of the entire organization. For example, when inventory management needs to be streamlined, 'Sagiv Solutions' does so, while freeing up resources of time and money for the benefit of employees. When inventory management is outsourced, the entire procurement process is streamlined – from managing the warehouses themselves, through controlling existing inventory to various logistics solutions. For example, if your business keeps one inventory count for a period – it will be much easier to do this if everything is arranged and organized correctly throughout the year, if inventory is listed properly, if warehouses are logically arranged and so on.
Keep in mind that procurement requirements differ between organization and organization, and this element must also be considered when applying for procurement process. For example, there is no comparatively small office requirement for a relatively small pharmaceutical company that employs hundreds of employees and consists of many departments. Using a procurement services company, which addresses all aspects of the purchase requisition within the business and makes the demand more efficient – will give you a calm and calm head and knowing that your business is in good hands and the procurement process is best managed. For example, Sagiv Solutions will create an effective procurement system within your organization, helping you to generate accurate purchasing requirements from every department or department within your organization.
