What is Procurement?
The meaning of procurement with regard to supply chain management is quite simple. To put it plainly, procurement is the method involved with finding and securing the goods and services your company needs to satisfy its plan of action.
E-procurement is also known as electronic procurement, and it’s a place where an organization uses an internet (or intranet) connection to procure goods and services it needs to function. e-procurement India aims to simplify and facilitate purchase processes by offering an integrated suite of procure-to-pay applications for purchase requisitions, sourcing, auctions, spend analysis, billing, contract, and vendor management.
Thus, the objective of procurement company management is to guarantee that the company(for example the purchaser) gets goods, services, or works at the most ideal cost.
To do this effectively, the procurement company manager should survey factors like quality, quantity, time, and location on a continual basis, along with negotiating to track down the best available pricing (and hence reserve funds) for the company.
However, procurement and supply chain management like this includes a variety of factors. Here are some of the steps involved in the Procurement process:
- Developing standards of quality
- Financing purchases
- Creating purchase orders
- Negotiating price
- Buying goods
- Inventory control
- Inventory management
- Disposal of waste product
- cost-benefit analysis or cost-utility analysis
It’s also essential to take note that companies can participate in both direct procurement and indirect procurement. Direct procurement includes the use of goods and services that influence the company’s primary concern, while indirect procurement is the expenditure of everyday operations and different necessities that don’t have a direct effect on the company’s profit.
In the supply chains in India process, procurement company responsibilities stop once your company has possession of the goods.
What do you mean by Purchasing?
Purchasing is a subset of procurement.
Purchasing refers to buying goods and services and often includes receiving and payment.
These steps related to purchasing within the procurement cycle are:
- Purchase Order Acknowledgment
- Advance Shipment Notice
- Goods Receipt
- Invoice Recording
- Three Way Match
- Payment to Supplier
A supply chain is the network of elements, people, information, resources, and capabilities that produce a particular item and disperses it to the final buyer.
Naturally, an organization’s supply chain will vary on the nature of the products or services it sells. It’s also essential to remember that in supply chain management, e-procurement is just a single part of the process.
Supply chains can include entities like
- Raw materials gather
- Vendors Merchants
- Producers and manufacturers
- Transportation companies
- Distribution centers
- Wholesale warehouses
- In-house staff
- Stock rooms
The supply chains in India can also include the task and functions that incorporate the capabilities that add to moving that item, for example, quality control, market research, procurement, strategic sourcing, operations, distribution, money, and customer service.
What is supply chain management?
so, if a supply chain is a network of manufacturers, suppliers, and logistics factors expected to get a particular item to your business and its customers, then, at that point, what is supply chain management (SCM)?
At its core, supply chain management is overseeing a supply chain to improve the flow of goods and services and change natural substances into items for the end purchaser.
Supply chain management is the critical part of an organization’s overall achievement, as upgrades to an association’s supply chain management strategy can:
- Increase margins and annual revenue
- Improve the company’s ability to compete
- Influence consumer satisfaction
- Optimize the rate of supply
- Reduces costs in several areas of the management
Each step toward the Supply Chain Process is turning out to be more data-driven. Artificial intelligence has become a compelling method for expanding efficiencies and benefits, making an extensive examination of information the new standard. Logistics, purchasing, and supply chains in India experts critically need to acquire relevant qualifications and experience to profit from the arising open doors in modern procurement.
13 SQ FT is an e-procurement company, that helps organizations regain control of their spending with e-procurement that integrates perfectly with any accounting system. If you’re looking for a better way to manage purchasing, procurement, and spending in your company, contact our team today and visit our website 13sqft.com for more details.