Purchasing is a better form of buying. It is a detailed exercise to understand materials and needs additional data collection regarding market trends, demand & supply chain, rates etc.
Objective of Purchasing Department is to get Right Quality materials as per agreed specifications at Right Time at Right Price ( Not the cheapest price).
Companies go for Centralised Buying Or Decentralised buying based on ABC & VED analysis. A Class items can go for centralised buying along with Vital ones. B & C class items may be procured on decentralised route.
Items of repetitive nature may be bought by Annual rate Contracts (ARC) with supplier to avoid clerical work. A mother order can be released with indication of total requirement & a Ceiling value. Delivery orders can be released subsequently by the stores department based on stock level.
