Procurement

A Report On:

Procurement

Executive Summary:

Procurement is important to identify, discover and interpret factors affecting acquiring goods and services. This report researches in detail factors affecting procurement within a larger sized business.

As Wagamama is a fast, casual dining restaurant, there are three main criteria affecting procurement: “speed, quality and value for money”. It is important to ensure that customers’ expectations are being met to ensure best possible sales.

This report explains in detail an approach to understanding the importance of procurement strategies and the importance of resource management.

The report also describes and evaluates plans to improve procurement strategies and best practice.

The analysis has led to the following findings:

• Goods and services need to be managed through the entire life cycle

• Specifications have to be as accurate as possible

• Different procurement methods are required to find the right suppliers

• A procurement officer can only become valuable if the business reaches a certain size

• Risks need to be identified, in order to avoid any financial consequences against the business goal

Therefore the following can be concluded:

• Goods and services need to be maintained

• Specifications are needed to identify the needs of the business and gain the best possible profit for the business

• Businesses need to identify their own best practice regarding the size of the company

• Procurement officers need to know their business very well in order to buy the right goods and services

• When a procurement officer has identified potential risks, he or she is more likely to avoid incorrect goods and services, and contributes, therefore, to the business goals.

Contents Page:

• Executive Summary 2

• Introduction 4

• 1.1 What is procurement 5

• 1.1.1 Selection Criteria 5

• 1.1.2 Purchasing Plan 6

• 1.1.3 Maintenance Programs 6

• 1.1.4 Equipment Checks 6

• 1.1.5 After Sales Service 6

• 1.2 Definition of a specification 6

• 1.2.1 Features of the coffee machine (Paparazzi 2007) 7

• 1.3 Selection Criteria 9

• 2.1 Different Procurement Methods 12

• 2.1.1 Best Practice 12

• 2.1.2 Further Methods 14

• 2.1.3 Advantages and disadvantages of a procurement officer 15

• 2.1.4 Role and responsibilities of a procurement officer 16

• 2.2 Risks and processes within procurement 17

Conclusion 19

Recommendations 20

References 21

Introduction:

Procurement refers to the overall process of acquiring a product or service. Depending on the size and importance of the procurement function within the business, it can involve the following steps:

• Identifying a need

• Specifying the requirements to fulfil the needs

• Identifying potential suppliers

• Ask, quote or tender for bids and proposals

• Evaluating bids, quotes, tenders and proposals

• Awarding contracts