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Purchasing Management: A Study of Prime Supermarket

   

Added on  2019-10-31

13 Pages2792 Words161 ViewsType: 161
Business DevelopmentCalculus and Analysis
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Running head: PURCHASING MANAGEMENTPurchasing management of Prime supermarket
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PURCHASING MANAGEMENT1Table of ContentsIntroduction.................................................................................................................................................2Supplier Selection and issues...................................................................................................................2Identification of possible suppliers......................................................................................................4Asking for supplier’s information.........................................................................................................4Process of negotiation.........................................................................................................................5Evaluation of supplier and award of contract......................................................................................5Research on supplier selection............................................................................................................5ICT for purchasing operation...................................................................................................................5Bar coding............................................................................................................................................6Radio frequency identification.............................................................................................................6Enterprise resource planning...............................................................................................................6Material resource planning.................................................................................................................6Recommendation................................................................................................................................6Purchasing cost analysis..........................................................................................................................7Inventory analysis................................................................................................................................7Suppliers analysis.................................................................................................................................7Maverick spending...............................................................................................................................8Delivery time analysis..........................................................................................................................8Conclusion...................................................................................................................................................9References.................................................................................................................................................11
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PURCHASING MANAGEMENT2IntroductionOrganizations comprise of different departments and purchasing department is accountable for all the activities of purchasing. Purchasing department is one of the important departments in all the businesses because it affects the product cost that might reflects companies profit positively (Moser, 2007). This report explains different aspects of purchasing management of Prime supermarket, which is situated in Singapore. This report will emphasize on supplier selection criteria, cost of purchasing and use of information and communication technology, for purchasing operations and its management. Prime supermarket is among the first to launch the chain of local supermarket (Prime supermarket, 2017). In earlier years, prime supermarket used to have 5 mini complex outlets. In 1991, Prime supermarket occupied more than 10,000 sq. ft. area. It is the largest chain of supermarket in Singapore with 20 outlets expanded in all its island states (Prime supermarket, 2017). Prime supermarket comprises of two trading areas, one focuses on import and provides seafood, meats and vegetables and another trading area focuses on acquiring stock according to the lifestyle of international consumer. Prime supermarket provides 24 hour services to their customers and also focuses on improving customer services. Presently, they are working on renovations of their stores. Mission of prime supermarket is to provide good services to their customers with good quality of product at affordable price (Prime supermarket, 2017).Supplier Selection and issuesPurchasing is one of the important element in supermarket business. Purchasing officer is responsible as well as accountable for setting goals and taking related decisions, which helps in improving cost of the company (Weele, 2009). It is a difficult task for purchasing officer of
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PURCHASING MANAGEMENT3prime supermarket to decide the value of their products, as they want to provide product at lowerprice by reducing the cost of supplies but they should not keep their prices very low as it will be considered as poor quality goods (Ouelch, & Bonventre, 2017). Cost of the product also increases due to fixed assets. For Example machinery which requires a regular repair, leads to anincrease in the cost of the product and it affects the revenue of the business (Ouelch, & Bonventre, 2017). Prime supermarket should consider all these points and after that they should decide the value of their product. Prime supermarket should provide good quality products as poor quality goods increases wastage that results in increasing purchasing cost. Suppliers of prime supermarket should deliver products on time, so that efficiency of the business can be maintained. For this purchasing officer of supermarket should maintain proper communication with their suppliers. Purchasing officer should identify their long term suppliers and should maintain a strong relationship with them which helps in cost reduction (Weele, 2009). Purchasing officer should identify some internal goals to maintain cost of the company, for this different policies are implemented into the company that product can only be purchased by approved suppliers (Ouelch, & Bonventre, 2017). Prime supermarket should select their suppliers properly, which can help them in reducing purchasing cost. Supplier selection criteria involve different stages listed as follows:-
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