It is common for organisations to neglect the area of purchasing. As a result, these business ends up spending more money than they should, or but inferior quality products, or select suppliers who do not offer the best customer service. Mostly, when the company does not devote more attention to their purchasing, the operating cost of the business would be very high thus reducing the profit margins and the company will either have to raise their prices or survive with low profits. For an efficient purchasing process, the company needs to buy the right quantity and quality of products at best, and at the appropriate time thus it would not be appropriate to allow every individual to purchase and order products.
The purchasing policy is more streamlined in a small organisation than in large organisations. Mostly I when the company is at the initial stage. In a small business, the owner decides what, when, and where to purchase. However, as the company grows, the owner will no longer be able to manage the purchasing process, and he will need to delegate to others or hire a purchasing manager.
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The purchasing should be the sole responsibility of the purchasing manager. In case the business does not have enough purchasing that requires the presence of a purchasing manager, the management should select an employee who can handle the purchasing and at the time take care of their duties. These personnel should be able to communicate well with the suppliers. The purchasing manager or the selected individual will have to collect orders, ensure they are complete, stay within the company spending limit, choose the best supplier, order the merchandise and check their condition upon receipt, verifies the accuracy of the invoice and forward the payment details to the finance department. Before delegating the purchasing role to another employee, the management should develop the purchasing policy of the organisation. This policy will ensure that the employee is guided by the quality of the products to purchase.
