The important factors of purchase cycle to be decided are:

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a)      What to purchase;

b)      When to purchase; and

c)      How much to purchase.

 

After receiving the Purchase Requisitions, the next step is to select the suppliers to whom the orders may be sent for the supply. This is done by inviting tenders or quotations from different suppliers.

 

While inviting the tenders, the supplying firms should be requested to state their terms and conditions of supply, delivery time, mode of payment, etc., clearly and to send the tenders in sealed covers.

 

Having accepted the tenders, the orders are place by the Purchase Department with the firms selected fro the purchase of requisitioned materials.

 

The purchaser order should be prepared on the printed form and should contain all the necessary details, so as to leave no room for any ambiguity or doubt and so as to avoid legal complications.

 

Follow-up of the Purchase order  if essential to keep the schedule of supply by  the specified date so that production work may not suffer.

 

The Receiving Department checks the supply from the copy of the Purchaser order and prepares his report of the goods received.

 

The Inspection Department makes an inspection of the goods received regarding the quality and specifications.

 

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