Best Practices to Streamline Your Procurement ProcessBuyers' Training
August 3, 2012 — 2,820 views
Purchasing professionals can utilize tips, tricks and best practices in order to streamline the procurement process, no matter the line of business. How a small- or medium-sized business acquires goods and services can have a major impact on the organization's spending and overall success. Because businesses can spend such an extensive amount of their sales revenue on procurement of raw materials and services, a reduction as small as 1 percent can result in considerable savings.
One of the best ways to streamline the procurement process is for purchasing professionals to improve the way they buy. Managing which department or individual is responsible for purchasing can make buying clearer and more systematic. Furthermore, this department or employee should conduct a spending analysis to determine how the organization spends. This analysis may include details from taxes and supplier charges to cost of raw materials and transportation costs.
Education and training are essential to streamlining the procurement process at any business. According to Business.com, purchasing training can have a major impact on a professional's ability to make the decisions and analyze reports associated with a seamless, efficient procurement process. Procurement staff with proper training should be able to do things for a company such as manage supplier relations and transactions, make advantageous purchasing decisions and select the best vendors and maintain ongoing relationships with these vendors, the resource explains. Ongoing training keeps purchasing agents' skills sharp and prepared to help streamline a company’s procurement process.
Furthermore, IBSI.com states that purchasing professionals should be provided with the tools they need to monitor and measure spending. Utilizing business software will help keep track of goals and a variety of companies now offer software for this purpose. However, the organization suggests still keeping manual, handwritten notes on purchase orders that pertain to issues such as expediting. It's also a good idea to keep a manual record of vendor communications when quality is a concern and when keeping track of purchase order receipts by hand.
Finally, companies and purchasing professionals should not be afraid to change their purchasing process. Forbes magazine states that many companies overpay for items and the real reason they continue to do this is because they are resistant to changing the process. For instance, oftentimes the root of the problem is that companies aren't spending enough time evaluating purchasing decisions and stay with the same vendors because they have been doing business with them for so long. In this aspect, a company could solicit multiple bids and review agreements to vendors periodically to ensure they are getting fair deals. This is just an example of how a small change in the purchasing process can make a big difference in streamlining procurement overall.