PURCHASING

DEPARTMENT
 COMMON ISSUES OF PURCHASING DEPARTMENT

A. Not Following Purchasing Policy- Managing multiple moving pieces

and people in your organization is challenging at best. When your
employees travel or expense items,it’s nearly impossible to keep
track all of spend. While people can catch some line items in
employee travel and expense budgets.
B. Fraudulent or Rogue Spend- In an ideal world, they would, but in the
real world, employees can often sign off on an invoice for more than
was approved, or even go rogue and spend without approval.
C. Overspending- When employees approve spend your company
didn’t budget for, it can erode profits and confidence in decision-
making.
1. Purchasing Duplicate or Excess Items by Mistake
 
Purchasing duplicate or excess items by mistake usually stems from not having
an effective purchasing approval process. When purchasing requests flow
through an approval sequence, it provides greater visibility and control to exactly
what is being purchased across the company.
 
● In the short-term, you can usually rectify this mistake by immediately following
up with the supplier, especially if you have a good relationship with the vendor
in question.
 
● But in order to safeguard your company from this procurement problem, in the
long run, you’ll need to adopt a better purchasing protocol that allows for
approval from more than one person.
3. Employees Aren’t Purchasing from Preferred or Approved Vendors
 
Buying from approved suppliers can help a company in more ways than one. Procurement’s
decisions on which vendors to work with are directly linked to a company’s risk management
strategy. Companies can ask more from approved vendors who they’ve worked with over
time. And approved suppliers are more likely to accommodate a company’s needs, provide
better terms and pricing, and become important business partners in the long run.
 
● You can fix this problem by introducing a centralized vendor management catalog that’s
easily accessible to those who need it. A visible, easy-to-access vendor catalog allows for
aligned purchasing, saved time, and negotiating power.
Leader: Butad, Claire
Assestant Leader: Antonio, Ledo
Member: Cuyos, Shane
Delgado, Andrea Mae