Best Procurement Practices

Being the person responsible for procurement in a company places you in charge of one of the most critical aspects of its success. You need to see to it that there is no department or individual lacking all the tools and items they need to do their job and to do so while adhering to your prescribed budgetary considerations. While you may be aware of what you need to do on a daily basis, you may need a review of your activities. Some of those mistakes are made in your daily duties which could jeopardize progress in your department. By addressing them, your work becomes much easier to perform.

You may have developed conflicts in your relationships with the suppliers. Managing supplier relations is a critical duty of a procurement official. A common mistake is to try and get the lowest possible price each time. You may be looking out for your business, but so are they. You therefore need to be more tactful in your approach, and know when to ask for lower prices, and when to take their offer. It is not wise to insist on the lowest prices from all suppliers as you will develop a reputation. You should instead think of the long term relationship. You need to settle on prices that benefit both parties, and you will receive goodwill from them, and also see timely deliveries, more discounts and other offers, and better handling of your items. When you are asking for better prices, always make sure you do not demand something they cannot sustain.

Another mistake is not being aware of any changes in the market. There are times when policy changes lead to better prices. A supplier will let you remain ignorant and pay the older higher prices. It is upon you to find out what items have been affected, and to ask for the reduction.
You should also not fail to utilize technology. Through technology, business processes become faster, and every opportunity becomes easier to attain. You need to make sure you are not lagging behind. Technology allows you to minimize your expenses, and make your operations more efficient. If you use digital invoices, for example, you save yourself printing and delivery costs. You also facilitate faster payment processing. Procurement processes can benefit from the digitization of their processes through the use of robust procurement systems. Those incorporate all the activities of the department, and even connect with the suppliers online. You can, therefore, place orders, track their delivery, make payments online, and manage your inventories better.

Procurement affects all areas of an organization, and so improvements in that department spell improvement everywhere else.

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