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    Here Are The Stages in The Procurement Process

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    The procurement process involves 10 key stages: 1) recognizing a need, 2) defining specifications, 3) examining supplier options, 4) negotiating pricing and terms, 5) issuing a purchase order, 6) delivery, 7) expediting delivery, 8) receiving and inspecting goods, 9) approving and paying invoices, and 10) record keeping. While the process may seem simple, it is dynamic with many moving parts and requires constant analysis to optimize. E-procurement systems can help streamline the stages to establish stronger spending policies for organizations.

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    Here Are The Stages in The Procurement Process

    Uploaded by

    mo
    112 views6 pages
    The procurement process involves 10 key stages: 1) recognizing a need, 2) defining specifications, 3) examining supplier options, 4) negotiating pricing and terms, 5) issuing a purchase order, 6) delivery, 7) expediting delivery, 8) receiving and inspecting goods, 9) approving and paying invoices, and 10) record keeping. While the process may seem simple, it is dynamic with many moving parts and requires constant analysis to optimize. E-procurement systems can help streamline the stages to establish stronger spending policies for organizations.

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    Here Are the Stages in the Procurement Process

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    Here Are the Stages in the Procurement Process

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    The procurement process involves 10 key stages: 1) recognizing a need, 2) defining specifications, 3) examining supplier options, 4) negotiating pricing and terms, 5) issuing a purchase order, 6) delivery, 7) expediting delivery, 8) receiving and inspecting goods, 9) approving and paying invoices, and 10) record keeping. While the process may seem simple, it is dynamic with many moving parts and requires constant analysis to optimize. E-procurement systems can help streamline the stages to establish stronger spending policies for organizations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    112 views6 pages

    Here Are The Stages in The Procurement Process

    Uploaded by

    mo
    The procurement process involves 10 key stages: 1) recognizing a need, 2) defining specifications, 3) examining supplier options, 4) negotiating pricing and terms, 5) issuing a purchase order, 6) delivery, 7) expediting delivery, 8) receiving and inspecting goods, 9) approving and paying invoices, and 10) record keeping. While the process may seem simple, it is dynamic with many moving parts and requires constant analysis to optimize. E-procurement systems can help streamline the stages to establish stronger spending policies for organizations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 6

    8/15/2017 Here Are The Stages in the Procurement Process

    Here Are The Stages in the Procurement Process


    Sean Kolenko (H ps://Blog.Procurify.Com/Author/Sean/)

    (h ps://twi er.com/intent/tweet/?text=Here+Are+The+Stages+in+the+Procurement+Process&url=h ps://blog.procurify.com

    (h ps://facebook.com/sharer/sharer.php?u=h ps://blog.procurify.com/2014/09/16/stages-procure

    (h ps://plus.google.com/share?url=h ps://blog.procurify.com/2014/09/16/stages-procuremen

    (h ps://www.linkedin.com/shareArticle?mini=true&url=h ps://blog.procurify.com/2014/09/16/stage
    process/&title=Here+Are+The+Stages+in+the+Procurement+Process&summary=Here+Are+The+Stages+in+the+Procurement+Process&s
    procurement-process/)

    For the uninitiated business owner or, for that


    ma er, the novice the procurement process can
    appear to be a simple, basic procedure.

    Locate needed goods. Pay. Receive purchased


    goods. Document transaction.

    But like all important (integral!) business functions,


    procurement is a layered, uid business process
    with multiple moving parts there are numerous
    stages in the procurement process.

    Procurement is so dynamic, in fact, that it requires


    constant analysis and monitoring by someone (or a
    team) within an organization. There is always more
    to know/more data to analyze/more forecasts to
    produce all of which is a responsibility of
    procurement.

    Sowhat are the stages in the procurement


    process? What are those constantly evolving pieces
    in procurement?

    Stages in the Procurement Process

    As one learns/reads more about the procurement


    realm, it becomes glaringly obvious that each of the
    writers, theorists and consulting rms involved in

    https://blog.procurify.com/2014/09/16/stages-procurement-process/ 1/6
    8/15/2017 Here Are The Stages in the Procurement Process

    procurement has a slightly di erent take on the


    stages in the procurement process.

    With that in mind, our friends at the Chartered


    Institute of Purchasing and Supply
    (h ps://www.cips.org/) and businessdictionary.com
    (h p://www.businessdictionary.com/) have cobbled
    together a solid list of the critical stages in the
    procurement process.

    Here it is:

    Step 1: Need Recognition This is a seemingly


    obvious step, but one that needs to be mentioned.
    A business owner (or procurement department)
    must recognize a product is needed in order to
    purchase it. That product can be either a brand new
    item, or one that is being re-ordered.

    Step 2: Speci c Need Does your industry have


    speci c requirements for various products. If that is
    the case in your industry, be sure you are up-to-date
    on those requirements and order accordingly.

    Step 3: Source/Examine Supplier Options Every


    business needs to determine where to get their
    goods. Some companies have an approved vendors
    list (this is a recommended practice) while others
    are still trying to determine who the best suppliers
    are. Once a supplier is chosen, companies should
    stick with that relationship and try to establish
    preferred pricing.

    Step 4: Price and Terms Once a supplier is chosen,


    companies should stick with that relationship and
    try to establish preferred pricing and speci c terms
    (i.e. delivery).

    Step 5: Purchase Order The purchase order


    (h p://blog.procurify.com//2013/09/23/all-you-ever-
    needed-to-know-about-purchase-orders/) is used
    https://blog.procurify.com/2014/09/16/stages-procurement-process/ 2/6
    8/15/2017 Here Are The Stages in the Procurement Process

    the formal contract used to buy the product. The


    purchase order outlines the price, speci cations
    and terms and conditions of the product or service
    and any other additional obligations.

    (h p://start.procurify.com/3steps/)

    Step 6: Delivery The transfer of the purchase order


    via email, mail or fax (email is highly recommended).

    Step 7: Expediting This stage addresses the


    timeliness of the service or materials delivered.
    Delays, for many businesses, are important. The
    purchase order will have expected delivery date
    information.

    Step 8: Receipt and inspection Once delivered,


    the receiving company inspect and, subsequently,
    accepts or rejects the product. Rejection is almost
    always due to a damaged product.

    Step 9: Invoice Approval and Payment At this


    stage, three documents must match when the seller
    wants payment the invoice, the receiving
    document (a ached to the product) and the
    original purchase order. This is known as three-way
    matching. If there is a discrepancy, it must be
    resolved before payment is made.

    Step 10: Record Keeping The receiving (buying)


    company must keep good records. This means
    saving all relevant documents for every completed
    purchase.

    https://blog.procurify.com/2014/09/16/stages-procurement-process/ 3/6
    8/15/2017 Here Are The Stages in the Procurement Process

    How can e-procurement help?

    FREE WHITEPAPER: Get the Three Steps To Be er


    Procurement whitepaper and learn how to
    establish stronger spending policies across your
    organization. (h p://start.procurify.com/3steps/?
    utm_campaign=blog-inline-text)

    An e-procurement solution
    (h p://blog.procurify.com//2014/08/11/e-
    procurement/) can be a signi cant source of help in
    various stages of the procurement process. For
    instance, an e-procurement solution will
    electronically generate purchase orders
    (h p://blog.procurify.com//2014/11/18/cloud-
    purchase-order-system/), with all of the requisite
    information.

    Also, an e-procurement solution is a critical tool


    when it comes to delivery and record keeping. With
    an e-procurement solution, all purchase orders will
    be sent electronically in the system (an email
    notifying all parties will be sent as well), ensuring
    delivery is completed immediately.

    Finally, an e-procurement solution will catalogue


    every transaction in the system, ensuring your
    records are kept up-to-date. Those records are of
    critical importance for nancial forecasting, or in
    the vent of an audit.

    The bene ts
    (h p://blog.procurify.com//2015/05/12/7-bene ts-
    of-e-procurement/) of an e-procurement system like
    Procurify
    (h p://www.procurify.com/bene ts) extend to each
    stage of the procurement process. Stream line your
    purchasing and procurement processes, reduce
    employee headaches, eliminate annoying
    paperwork. Switch to an e-procurement system like
    Procurify today (h p://www.procurify.com/signup)!

    https://blog.procurify.com/2014/09/16/stages-procurement-process/ 4/6
    8/15/2017 Here Are The Stages in the Procurement Process

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    7 responses to Here Are The Stages in the Procurement Process


    Pingback: Purchase and Inventory Management So ware (h p://blog.shivit.com/index.php/purchase-inventory-
    management-so ware/)

    REPLY

    Abubakar msa says:

    November 12, 2016 at 10:45 PM (/2014/09/16/stages-procurement-process/#comment-1901)


    Its actually a good source of information that is needed, keep it up and give extensive narration of the points. Other wise I
    am humbled using this site.

    REPLY

    Nitant says:

    November 14, 2016 at 5:56 PM (/2014/09/16/stages-procurement-process/#comment-1903)


    Thanks, Abubakar. Were happy this was of help to you!
    Indeed, a lot of blog posts and papers on procurement fail to delve too deeply into the concepts they explore.
    This tendency o en obscures procurement literature in general, and were trying our best to do things
    di erently.

    REPLY

    Aika says:

    January 3, 2017 at 6:18 PM (/2014/09/16/stages-procurement-process/#comment-1948)


    good lesson learned , now I need to start a business

    https://blog.procurify.com/2014/09/16/stages-procurement-process/ 6/6

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