PROCUREMENT CYCLE
PROCUREMENT means a process that is responsible for buying the material or services from a vendor. Procurement is a way to arrange the material in Right Quantity at Right Place in Right Value.
Procurement is divided into two parts.
1. BASIC/STANDARD Procurement
2. SPECIAL Procurement
# BASIC/STANDARD PROCUREMENT
A standard way to procure the material where an organization trying to maintain a minimum level of inventory due to high-level inventory with a high price value of inventory.
Basic procurement is two types.
1. STOCK V/S CONSUMPTION
2. INTERNAL V/S EXTERNAL
STOCK PROCUREMENT
A material that is kept in stock after receiving from a vendor. This type of stock must have a master record in the system.
CONSUMPTION PROCUREMENT
A material which is consumed as soon as consumed after receiving from a vendor. This type of stock may have a master record in the system as per client requirements.
INTERNAL PROCUREMENT
When a material is procured within a company where this material is a raw material for one segment of that company but a finished product for another segment in a company. Any trade between these segments is recorded by the system.
EXTERNAL PROCUREMENT
When a material is procured from outside the company and a purchasing organization is responsible for this procurement.
# SPECIAL PROCUREMENT
A material which is procured in a special way of special requirements. Here is the list of a special type of procurement.
1.CONSIGMEMENT PROCUREMENT
2.SUB-CONTRACTING PROCUREMENT
PROCUREMENT CYCLE/ACTIVITIES means a list of steps required to procure this material from a vendor .
PROCUREMENT CYCLE is also known as the PROCURE TP PAY CYCLE.
There is following steps are required to complete this cycle.
1.REQUIREMENTS 'S INFORMATION GATHERING BY PURCHASE REQUISITION.
2.VENDOR SELECTION BY PURCHASE QUOTATION.
No comments:
Post a Comment