Purchasing and Supply Management Process Steps

Steps in Purchasing and Supply Management

1. Identification of the need to purchase (regular or investment).
2. Item identification and selection of suppliers (ABC criterion).
3. Request, receipt, and supply analysis (includes negotiation, if appropriate).

Supply Management Stages

4. Internal authorization of purchase (as authorized and type of product).
5. Purchase Management:
   • Completing and submitting written documentation.
   • Monitoring progress.
6. Receipt and control of goods.
7. Making goods available to users.
8. Control billing, accounting, and payment.
9. Documentation and archiving.
10. Evaluation, Validation, Audit, etc. (e.g., using methods like ISO 9000).
    • What? Who? When? How? -> Method (e.g., ISO 9000).

    Example: Requirements UNE-EN-ISO 9001 (2008).

Request for Offer: Supplier Information Required

• Quantity (scaled).
• Technical specifications (standards, plans, specifications, etc.).
• The place, time, and mode of delivery (+ frequency, if appropriate).
• Packaging, transport, and insurance (INCOTERMS).
• Tools to use and production capacity thereof (if applicable).
• The deadline for receipt of the offer.

Request for Offer: Provider Information Provided to Client

• The total unit price and the conditions applied (scaled).
• See what's included (taxes, transportation, insurance, packing).
• Your payment terms (currency) and discounts (if applicable).
• Delivery time; express acceptance of the terms of the order.
• Validity of the offer.

Note: Review the language carefully.

Homologation and Evaluation of Suppliers and Subcontractors

For reliability and required service levels in purchasing and supply management, especially for major or strategic suppliers (ABC classification) and for continuous supplies, an approval system and supplier evaluation is necessary.

Benefits of Supplier Evaluation

• Long-term improvement of procurement management.
• Allows support for the policy of reducing the number of suppliers (economies of scale, agreed quality programs designed by the supplier, etc.).

Key Considerations for Supplier Evaluation

1. Reasonable and consistent organizational structure.
2. Technical links with international firms.
3. Production process / supply sufficiently integrated.
4. Technical development and skilled helpdesk.
5. Level of competitive and stable prices.
6. Financial situation.
7. Adequate supply to the requirements.
8. Reliability of deliveries (including conditions).
9. Quality assurance level (appropriate to requirements).
10. Social and employment stability.
11. Geographical Location.
12. Response to emergencies.
13. Importance of environmental considerations.
14. Flexibility and adaptation to new technical situations.
15. Degree of saturation with respect to total capacity.

Additional Evaluation Points

• Include exclusion procedure for approved suppliers/subcontractors.
• Address the question: "Purchases from a vendor not approved?"
• Know your suppliers (visits, audits, etc.).
• Maintain a critical eye.