Purchasing departments streamline the process of procuring products and services for the organisation. Various departments collaborate with the purchasing department to contact vendors and negotiate prices. Purchasing departments share common goals, regardless of the organisation.
One common purchasing department goal is to manage the bid process fairly and impartially. Many companies offer vendors the opportunity to bid on large projects. To eliminate any perception of favouritism, the purchasing department aims to manage the bid process fairly, giving all qualifying vendors the chance to submit a proposal. The purchasing agent contacts current and potential vendors with specific information regarding the contract work and invites each vendor to submit a bid proposal. If the bids are sealed, confidentiality is essential to maintaining a fair process. Companies owned by relatives are generally excluded based on the relationship and the potential misperception.
Purchasing departments in larger companies strive to include minority and women business owners in their list of qualified vendors. Purchasing agents routinely ask current and potential vendors if the business is owned by a female or minority. This data is logged into the system and the company analyses the business it provides to minority and business owners. Companies that regularly hire minority businesses gain the benefit of expanding their vendor selection and promoting themselves as a diversity-friendly company.
Negotiate Low Prices
Purchasing departments work to minimise the cost of any contract to the company. The purchasing agents work with the employees of other departments to identify what requirements the product or service must meet in order to be effective for the company. Armed with this information, the agent negotiates with the salepeople from one or more vendors. Based on the offers from each vendor, the agent might seek clarification from the requesting employee. Once a final vendor is decided upon, the agent contracts with that company to provide the product or service at the agreed-upon price.