Technical Procurement Process Guidelines To Obtain Goods And Services


Procurement is the act of obtaining goods and services. Unlike consumer purchasing, procurement is a business process that follows consistent steps for the purpose of filling a need for the company. There are six main steps to the procurement process outlined below. You do not need to get a business degree to become a business owner. However, it may leave you unprepared for some of the technical processes that go into owning a business.  As a new business owner, it is important to familiarize yourself with this vital process of procurement. Keep reading.

Procurement vs. Purchase

Purchasing and procurement are similar, but different. Many business owners do not recognize the differences between procurement and purchasing. This is important to understand. Procurement is the process of selecting vendors and establishing guidelines. These guidelines include payment terms, strategic vetting, selection, contract negotiation and ultimately purchasing the goods. Simply put, procurement is the overarching process of which purchasing is just a small part. This is an important distinction to keep in mind.

Step 1: Define A Need

The first step to the procurement process is to define a need. This need could be any fundamental business requirement. Do you need to source some software for your office? Do you need materials for a construction job? Are you looking for building maintenance workers? Or, perhaps you are looking for a linen service for business. All of these goods and services are handled through the procurement process.

Step 2: Source Options

Once you have identified a need, the next step is to research your options to fulfill this need. Many businesses will have a list of approved vendors for recurring procurements such as office supplies. However, if you do not have an approved list or the need cannot be met by current vendors, you will need to locate new resources. Be sure to complete thorough research in order to find the best possible supplier.

Step 3: Price And Terms

When you have chosen a supplier, the next thing to do is settle on a price and terms. Discuss with a representative the specific needs of your company. Are you making a one time purchase for telemarketing services? Could this delivery experience determine whether you enter into a contract with the supplier? These are all important things to keep in mind as you establish terms. Do not be afraid of detailed negotiation. Find out exactly how and when your goods will be shipped, consider invoice processes and term payments. Planning these things out now will benefit you later on.

Step 4: Purchase And Delivery

The next step in the business procurement process is purchase and delivery. After you have settled on a contract or terms for the shipment, you can officially place your order and have them shipped to your business. In some companies, this may require approval from upper management. As a new business owner, you should consider who will be handling the procurement of goods and services and how much agency they will have.

Step 5: Inspection

Inspection is a crucial part of the procurement process for every purchase, including commercial roofing. Upon delivery, it is your company’s job to inspect and evaluate the received goods. Particularly if you are working with the supplier for the first time, you want to thoroughly examine your order to ensure that it is correct and the quality is acceptable. If something has gone wrong, this will be your last opportunity to take it up with the supplier.

Step 6: Payment

Only after a thorough inspection are you ready to process payment. You should receive an invoice from your vendor with the agreed upon price from the negotiation stage. To complete the procurement process, make your payment and begin integrating the goods or services ordered into your business.

The process of procurement for business is complex. In order to procure goods and services as a business, it is always important to remember documentation, negotiation and evaluation. Keep track of orders and invoices, find what you need for the best price and always inspect deliveries before approving payment. As long as you follow these steps closely you should be able to acquire everything you need for your business for the lowest price and highest quality available, which will help you to guarantee business success for yourself.

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