A presentation

on
MATERIAL PURCHASING PROCEDURES

Prepared By:
Paras Joshi
 Background & Origin
Purchasing Procedure Diagram
Purchasing Requisition
Tenders or Quotations
Purchase order
Receiving and inspecting material
Checking and passing of bills for payment
 Material & Material Purchasing

Material is one of the essential element of

production.

The term material refers to raw material.

Purchasing involve acquiring materials of

right quality in a right quantity at a
reasonable price and at right time.
 Purchasing
requisition

Checking and
Tenders or
passing of bills for
quotation
payment

Receiving and
Purchase order
inspecting materials
 It is a formal request initiated by the store
keeper or a specific department for the
purchase of specific items. IT has three
purposes which are as follows:
To inform the purchasing department about
the need to purchase a material.
To fix the responsibility of the department
making the purchase requisition.
To use for future reference.
 After receiving purchasing requisition, the
purchasing department has to find the best
source to purchase the material from.
Selection of a particular supplier is made after
inviting quotations or tenders from possible
sources of supply.
Invitations for tender in a prescribed form are
sent to prospective suppliers.
 The purchase order is a contractual
agreement with the supplier for the supply of
materials.

It is prepared in five copies.

 The receiving department should perform the
function of unloading and receiving of
materials dispatched by the suppliers.

It has to verify the quantity and condition of

materials.
 When the invoices are received from the
supplier, they are sent for verification.
After the verification, the store department
requests the accounting department to make
the payment to the supplier.
Payment will be made according to the terms
specified in the contract.
 It is the first process set by a manufacture
to control materials.

Material purchasing process may be different from

one company to another.

It starts with the issue of material requisition and

ends with the receipt of materials and payment of
the cost of materials.