URDANETA CITY

UNIVERSITY
Owned and operated by the City Government of
Urdaneta.

ACTIVITY 3

I. Briefly answer the following questions:

1.What is procurement?

ANSWER:

The term "procurement" can apply to either the full procurement process or just the
last stage of purchase. However, the emphasis is typically on the company doing the
soliciting. Organizations can act as either the buyer or the seller.

2. What are centealized and decentralized procurement.

ANSWER:

CENTRALIZED PROCUREMENT:
Centralized purchasing or procurement is a system in which one department manages
the purchasing of goods and services for the entire organization.Example of centralized
procurement are standardized purchasing system, raw materials, commodities, IT
equipment, and MRO goods for maintenance, repair, and operations, and other
standard services such as cleaning services can easily be procured from a centralized
system.

DECENTRALIZED PROCUREMENT:
Decentralized procurement allows individual stakeholders to make purchases for their
departments, unlike in centralized procurement operations, where all purchasing is
conducted by a central procurement team. Good examples of decentralised business
are Hotels, supermarket, Dress showrooms

3. Explain the strategies for assessing hotel supply

ANSWER:

Identifying the Set of Business Goals and

Objectives
- It entails deciding on a growth strategy and putting organizational policies and
procedures into practice. It will highlight the needs of each department, and goal-
setting, which measures how well a firm will perform, is crucial for assessing it's
performance.

Identifying Relevant Criteria for Supplier Selection.

- Having these criteria, then, will aid in choosing the best supplier. This will assist you
in identifying their strengths and weaknesses. This might assist you in determining
which supplier is the greatest and what benefits you will receive from choosing them.

Evaluating and Selecting Suppliers

- It refers to how effectively the suppliers are preparing to meet the needs of the
organization. You can assess them to discover how well they are performing their work
and living up to your expectations. This could also assist you in choosing a supplier
who is diligent, reliable, and trustworthy.

Negotiating and Contracting with the Selected Suppliers

- It implies that you must make sure to involve all relevant parties in the contracting
process and to get insightful information about how the transaction will ensure that the
benefits are realized to their fullest potential.

Evaluating Supplier Performance

- This procedure contributes to a successful and efficient practical evaluation. This will
also shed light on potential areas for enhancement in order to increase supplier
performance. Additionally, it reveals the efficacy of your supplier management system.
4. Enumerate and explain the process of Supplier selection.

ANSWER:

First Stage: Evaluating Offers

- Every buyer should use an evaluation process before choosing an offer to make
sure all organizational needs are being taken into account and optimized.

Second Stage: Operational Capacity Analysis

- Make sure the prospective supplier can meet your needs by being able to plan
orders effectively and keep track of current production activities.

Third Stage: Technical Capability Determination

- Verify that your potential supplier has the talent, resources, and tools required to
meet your needs.

Fourth Stage: Financial Analysis

- On the basis of their financial stability, leverage, and competitive advantage,
financial ratios help suppliers be chosen and qualified.