Purchasing Management

Running head: PURCHASING MANAGEMENT 1
Purchasing Management
Name
Course
Date

PURCHASING MANAGEMENT 2
Introduction
Dairy Farm International Holdings Ltd (DAIR) is a local company that operates
in Singapore. They have supermarkets, hypermarkets, and grocery stores around
the country. It is a company that has got a huge interest in the retail business. They
have several brands such as Wellcome, Yonghui, Cold storage, and market place.
They have health and beauty stores, home furnishing, and restaurant. As the
purchasing manager of this organization, I am in charge of the purchasing
management department. Purchasing decisions and strategies affect how a
business grows and makes a profit. A business has to have a supplier selection
criterion. These are the values that a buying organization expects from the supplier.
Purchasing costs are the costs incurred while purchasing some of the goods and
services required in a firm. The essay below looks at the purchasing goals and
needs of Dairy Farm International Holdings Ltd. It also gives recommendations on
the best criteria when selecting suppliers and decisions made regarding the criteria
to be used. The essay also recommends an excellent technological system that can
improve the purchasing system. Lastly, the essay looks at the purchasing goals and
needs of Dairy Farm International Holdings Ltd (DAIR).
Supplier selection criteria and issues
The purchasing department has several purchasing needs and goals. Its first
goal is to purchase raw materials necessary to be used in their stores. It is the role of
the department to procure the necessary materials that are needed for the efficient
functioning of the company. Since it is a retail business, it is the role of this
department to ensure that there are always items on the stores to keep the
customers happy ("8 Benefits of Procurement Technology Tools," 2017). The
department also aims to buy products at the right price. It is one of the objectives of
the department to ensure that it evaluates the market prices and selects an item with
the best prices. The best possible price determines the revenue and the profit of a
business. It is the goal of the business to ensure that items are delivered in a timely
manner. That is, they are neither too early nor too late. Both situations may have
adverse effects on the business. If the materials are stored in the rooms for a long
time before use, they may expire hence making the company incur losses (Seuring,

PURCHASING MANAGEMENT 3
2013). If they fail to be delivered on time, they may lack the products to sell to the
customers. These are some of the goals set by the department.
The business too has various purchasing needs. First, it has to determine the
number of goods that are needed to be purchased. They have to prevent damages
to the products. To do this, we have to divide the goods into three classes based on
their economic order. The department also has a production schedule. This may be
determined on a monthly basis. These schedules are important since they enable
them to determine the number of goods that should be purchased. Lastly, it is our
role to check the quality of goods (McCue & Roman, 2012). To maintain and get
loyal customers, the business has to provide quality products. Quality is determined
through value analysis. Some of the ways that a product`s quality can be weighed
are by checking the weight, shape, flexibility, size, etc.
Being the purchase manager, I would suggest a supply selection criterion that
is efficient for the company. The company should introduce the supplier code of
business conduct. The suppliers should abide by the rules in the contract. They
should also act ethically since the company maintains high ethical standards. The
criteria should ensure that the goods are high quality, safe for human consumption,
convenient with minimal risk, and should be socially responsible. As a leader, it is my
duty to ensure that the criterion is efficient (Hajli, 2015). There should be policies set
for all vendors who would like to supply goods to the company. First, I would request
the company`s board to pass an anti-bribery policy. It is a policy that both the
employees and the vendors should respect. It ensures that all the interactions
between the employers and employees are done in an open and transparent
manner. The method will ensure that the company only deals with the best suppliers
in the market. The company should avoid dealing with cartels. The suppliers who are
willing to work with the company should not have faced criminal charges before
(Amin & Zhang, 2012). This will ensure the company does not deal with criminals
and maintains a good record.