Chapter 2, Problem 7DQ

Summary Introduction

To explain: The reason why some firms are no longer relying on the idea of competitive bidding when purchase contracts are awarded.

The purchasing process:

The purchasing process encompasses all the activities as shown below:

• Identification of user requirements.
• Evaluation of the user needs effectively and efficiently.
• Identification suppliers who are capable to meet the demand.
• Development of agreement with those suppliers.
• Development of the ordering mechanism.
• Ensure that the payment process occurs promptly.
• Ascertaining that the needs are effectively met and
• Driving continuous improvement.