Executive Summary

Purchase orders are used by organizations to buy goods and services.

Value relates to the actual good/service as well as the efficiency of the transaction, compliance with policy and ability to leverage knowledge gained from the transaction in the future

Having a Purchasing Process in place will -- Save Money-- improve control-- Increase Value you Get from Supplier

Purchase Order - What is it?

• A purchase order is a contract between the Buyer and Seller.--Sometimes there is confusion whether a PO is a contract but it is. If there is a separate master agreement, service agreement, Statement of work, proposal etc. that can be incorporated into the PO by specific reference. • Used effectively it clearly describes what is needed by the Buyer• It contains all information for Buyer and Seller to conduct the transaction from fulfillment to payment• A purchase order provides a level of control, documentation, and data history that can be used for audit and business analysis.

PURCHASE MANAGEMENT

One of the most important activities of Materials Management is Purchasing.

Purchasing ensures the following:• RIGHT MATERIALS are purchased, at• RIGHT PRICE, from• RIGHT SUPPLIERS, at• RIGHT TIME, & delivered to the• RIGHT PLACE.

Purchasing Department – The Purchasing Department is the interface between the Supplier of Materials and the Production Function.

Materials comprise one of the largest components of expenditure in any manufacturing firm, hence their procurement requires careful management.

The Responsibilities of Purchasing Department include the following:

• Learning the material needs of the organization.• Selecting suppliers and negotiating the price.• Ensuring delivery.• Monitoring the cost.• Monitoring the quality and delivery performance

SAP Purchasing1.Creating Purchase Order (PO) -- me21n2. View purchase order -- me22n & me23n3. Printing a PO -- me23n4. Open a Po report -- me2L5. Finding PO’s by Part NO -- me2m6. Locating PO Information -- XK037. Faxing a SAP PO -- me22n8. Grn -- mb01 9. Vendor Code Search – me2n10. Po release – me29n11. Cost price check – mm6012. Cost price chang – me12

Description of Requirements

• Description• Quantity• Price• Quality Requirements as Applicable• Unit Price• Total Price• Tax Rate as applicable

Logistics

• Ship to Address

• Shipping terms

• Shipping Method

• Packaging Requirements • Reporting needs/Updates

Consumption Pattern

• When there is any short of raw material in the warehouse, we consume the product from the floor.

• Consumption detail in excel.• Consumption is done on weekly basis.

Dump Food Dumped food are those foods which are damaged, wastage, expired or end of shelf life. Some eg in below picture of vendor zorabian .Also dumped list collected.

Strategy to improve Purchasing Agenda In Foodhall

1. Establish, Monitor & follow Department Goals : (to keep track)2. CRM and now VRM :- (keep track of vendor quality issues, expediting of purchase orders, request for quotes and other every day purchasing functions.) 4. Purchase Orders5. Purchase Order Acknowledgements6. Expediting of Past Due Purchase Orders7. Vendor Managed Inventory (VMI)- (negotiation)8. Vendor Performance Reviews9. Vendor Purchase History Analysis10.Networking and Continued Education

Foodhall WareHouse

Demo CounterDemo counter– It is the face of the foodhall.

DSR

Value Analysis

• Also called as ‘Value Engineering’• It is a combination of Purchasing and Methods Engineering.

• This activity is aimed at modifying the specification of materials, parts & products to reduce their cost.

• Value analysis has wide acceptance as it offers increased value of a product without increasing the cost and it reduces the cost without reducing the usefulness of the product.

• It is widely used by many companies and governmental agencies

Thank You