What´S Procurament Management Essay

1111 words - 5 pages

PROCUREMENT CYCLE
During the order to know the procurement documents, it is important to understand the expression Procurement Management. Procurement is the purchase of services and goods at the best probable price to meet a purchaser's require in terms of quantity, quality, dimensions and site.

Information Gathering:
A prospective customer first researches suppliers, who convince requirements for the product desired. Information gathering activities are processes used to get hold of information on the availability of goods or services, the accessibility of prospective suppliers, and the level of attention in the opportunity. These activities are not aggressive processes as they are not ...view middle of the document...

If the notice of intent process identifies that there are other existing, qualified, and interested suppliers, a competitive process will end result.

Supplier Contact:
While a probable supplier has been identified, the customer requests for quotations, proposals, information and tender. This may be done during advertisements or through direct contact with the supplier.
Procurements and the resulting contracts must be managed correctly and effectively. Payments must be made in agreement with provisions of the contract. All invoices must include detailed information sufficient to warrant payment. Every overpayment should be recovered in a timely manner. Supplier performances have to be managed and documented, and any performance issues must be addressed. To handle disputes with suppliers during the life of the contract, Organizations should contain a dispute resolution process in their contracts.
For services, organizations must: Establish clear terms of reference for the assignment. The terms should include objectives, background, scope, constraints, staff responsibilities, tangible deliverables, timing, progress reporting, approval requirements, and knowledge transfer requirements.

Background Review:
The customer nowadays examines references for the goods/services concerned and may also consider samples of the goods/services. In a background review phase references for product quality are examined and any requirements for follow-up services with maintenance, installation, and warranty are investigated. The study revealed that, for adversarial relationships, the background review is easier to automate due to the comparatively small amount of information required to complete the phase. The products must go by a quality inspection and match the description of the product specified. The findings demonstrate this type of background review cannot be automated.
Negotiation
Next the negotiations regarding price, availability and customization options are undertaken. The contract about the purchase of the goods or services is fulfilled.
Vendors Are Partners
The emphasis in negotiation moved away from lowest price scenario to negotiating with less amount vendors to get the lowest price with the best service, quality and conditions. The aim for companies were to reduce overall spends rather than negotiate lowest price with a large number of vendors, which did not give the best overall result. In a associate type or relationship the buyer will encourage the vendor to increase quality and service.
Negotiation or RFQ
Non-government purchasing departments keep on to offer a range of prequalified vendors a...

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