Discover the Perfect Purchase Invoice Sample for Procurement

Purchase invoice sample for Procurement

hi welcome to education leaves in this video you are going to learn what is procurement the procurement process and what's the difference between direct indirect and services procurement let's start the video procurement can be defined as the process of acquiring goods and services from a third-party vendor through direct purchasing competitive bidding or tendering process while ensuring the right quality and quantity procurement is most commonly associated with businesses because companies need to solicit services or purchase goods usually on a relatively large scale procurement is usually a part of the input to a company that uses the procured goods or services in the making of their own final product this makes it a very vital function of any business procurement involves activities such as identification of needs sourcing selection negotiation ordering receiving and payments now come to the procurement process the procurement process refers to the identification and implementation of certain steps to ensure that they can acquire goods and services to meet their requirements and achieve their objectives the procurement process isn't the same for all businesses because it can vary ing to needs each business has its own set of needs and so it will have a different procurement process compared to another business which has different requirements every organization has a unique procurement process flow steps involved in a procurement process are step one identification of requirement the first step in buying something is recognizing that there is a need for it that could be buy a new item or reordering something when it is required it is important that all the stakeholders be consulted at this stage to prevent issues later on in the procurement process step two determination of the specifics of the requirement when it has been identified that there is a need the exact specifics of the product or service that is required is to be decided upon this would include technical specifications or part numbers step three sourcing once it is determined that a specific item or service is to be bought the procurement team has to then do the research to determine the various sources that supply it for repeat orders there will usually be a pre-existing vendor list for new item suppliers will need to be thoroughly investigated to determine their reputation speed quality reliability and prices step four negotiation and finalization of price and terms for direct purchases requests for quotes will be sent to the shortlisted vendors the usual practice is to get a minimum of at least three quotes before making a selection the company to procure from will be selected not only on price but also based on their promptness reliability and quality if there is a bidding or tendering process for the procurement the selection of the qualifying bids will be as per the terms and conditions set step 5. purchase requisition and order a purchase requisition generated within the company will be approved by the appropriate authority this will then lead to the generation of a purchase order with all the specifics of the order as well as the terms and conditions step six delivery of the purchase order the shipment notice is sent to the buyer wherever applicable the delivery of the purchase order depends on the practices of the buyer and the seller it can be in person or by email this is also as per the specifications agreed upon by both the buyer and the seller step 7 expediting this involves creating the timeline for the prompt delivery of the requested goods or services after factoring in any unforeseen delays it may also include information on the payment as well as delivery schedules step 8. receive and inspection when the product or service is ready it is supplied to the buyer it is the responsibility of the buyer to thoroughly inspect the supplied items if they match the agreed-upon purchase order the buyer can either approve or reject it step 9. payment process if the buyer takes delivery of the item it is implied that they are accepted and the payment process starts for the payment to be made the documents relating to the order are studied if there are any mismatches they have to resolve them before payment once payment is approved the payment is made as per the agreed-upon modes of payment step 10. record-keeping and review both the companies the buyer and seller maintain their records for their auditing and taxation processes the entire process should be under continual review in order to improve as well as settle any disputes that might have arisen the steps of procurement detailed above vary from business to business but the logical flow remains the same efficient procurement practices keep the flow of purchased goods and services quick and delay free let's move on to the difference between direct procurement indirect procurement and services procurement [Music] direct procurement is the purchase of the input that a business requires an order to manufacture its end product this is the raw material that is required usually for a manufacturing related business examples raw materials machinery etc indirect procurement is the procurement of services or input that are not directly used in manufacturing but are essential for day-to-day operations examples office supply facility management travel maintenance service etc service procurement is procuring and managing the contingent workforce and consulting services for examples professional services software subscriptions etc if you want to read in details or download the pdf go through the link in the description like share the video and don't forget to subscribe to my channel