IMPORTANCE OF PURCHASING MANAGEMENT

Today we would like to talk about the importance of purchasing management in a firm. Let say a well-known company such as NESTLE need to produce their product.

But have we ever though about their materials uses?
Have we ever know whose the person who did such kind of work?

Please do not worry our beloved readers, we will tell you everything here. In NESTLE company there were one department called purchasing department(purchasing management). This department was responsible to purchase every materials need for their product. 

So, we will elaborate this topic based on below issue that is:
-arrange the flow of materials
-smooth the production
-quality of product
-cost and pricing
-choose supplier by quotation
-goodwill/reputation of firm 
      
One of the importance of purchasing management is to arrange the flow of materials. Usually the concept use is JIT (just in time ) which is provided customer need without delay. The production was not conducted all time so the purchaser need to purchase based on their requirement for every production line. For example they would like to produce MAGGI to export to INDONESIA and they need flour and others materials to produce it.

on the other hand, the purchasing management is to smooth the production. To get the successful purchasing they need to know their firm's need to produce the goods by finding the good suppliers and avoid the faulty supplies to smooth their production. This also will create harmony in an organization.

Third, the purchasing management is quality of product. To achieve a good quality product, purchaser had to find a quality raw materials from suppliers to verify their quality such as ISO. The quality is to achieve when the product is function well. 

Futhermore, cost and pricing. Negotiation between the suppliers and the purchaser to get the lower cost from supplier. Getting the products/raw materials/components at the lowest price will lead to low pricing. To get the lowest cost, purchaser must find several suppliers and choose the lowest one.

In addition, the purchaser need to decide which supplier who provide the lowest price and high quality by finding a lot of supplier and ask them to send the quotation as this will give the purchaser a chance to choose which supplier is better to provide his firms the raw materials.

Lastly, purchasing is very important as the firm will have a relation with the buyer/buyers, and having a good relationship with the buyer/buyers will reflect the attitude of the firm. Have a good reputation is a bonus to the firm as the market is challenging and it will help the firm to perform well in business.