8/13/2019 Purchasing, Receipt & Inspection of Material

1/11

8/13/2019 Purchasing, Receipt & Inspection of Material

2/11

Various types of purchases are:1)One time purchase:Mainly for the

larger items or expensive equipments.Once purchase is made, supplier' sobligations are over after warranty and

guarantee period.2)Fixed time contract: Contractperiod varying from one to three years

is fixed up with suppliers. In this,supplier are obliged to give the items

at the rate fixed up at the time of

entering into contact.

8/13/2019 Purchasing, Receipt & Inspection of Material

3/11

8/13/2019 Purchasing, Receipt & Inspection of Material

4/11

5) Lease and purchase: Afterleasing and using the equipment

for some time, it can bepurchased by paying the requiredamount.

6) Buy Back: Old equipment ofthe some company and at timeseven of another company is taken

away by the supplier who givesproportionate discount forpurchasing new equipment.

8/13/2019 Purchasing, Receipt & Inspection of Material

5/11

Steps involved in purchaseDetailed specifications are prepared using

unambiguous language.List of suppliers, their address, capabilities,past experience and reputation is updated.

Enquires can be a) directly to the vendorsb) quotations are invited c) tenders areinvited by public advertisement d)globaltenders can be invited.

Tender conditions, supply period, time limitetc. must be clearly mentioned.Sealed envelope containing offers can bereceived as one common envelope.

8/13/2019 Purchasing, Receipt & Inspection of Material

6/11

Envelopes are opened in presence ofauthorized persons or authorized

committee.Comparative Statements mentioningfollowing details is prepared. Name of the supplier

Details of specifications Basic Price Taxes, levies, installation charges

Freight and insurance charges Payment terms Delivery period Terms & conditions

8/13/2019 Purchasing, Receipt & Inspection of Material

7/11

All the responsive offers are discussed atthe purchase committee and final decision is

taken after necessary negotiation.After satisfactory demonstration andconfirmation, all the required documentssubmitted and formal order is placed.

If the item is to be imported, followingdocuments are required. License

Product literature and proforma invoice Custom duty exemption (CDE)

Not manufactured in India certificate(NMIC)

8/13/2019 Purchasing, Receipt & Inspection of Material

8/11

Effective Purchasing:- Consider the following points :-Local suppliers are preferable to outstation

suppliers because of ease of personal discussion& setting disputes.Prepare a list of vendors for each item basedon their reputation.When possible, procure directly frommanufacturers rather then trading firms.Avoid suppliers who insist on advance

payment.As incorrect supplies cannot be rejected aftertaking delivery of the consignment, do notaccept supplies through VPP & negotiation of

documents through bank.

8/13/2019 Purchasing, Receipt & Inspection of Material

9/11

Receipt Pre acceptance check:Receive the materials at a specified

receiving area.At the point of delivery, cheque each item

physically & count against suppliers invoice or packing challan.Cheque physical condition of materials.

Tearing down unitized load & restructuring

them make handling & storage time-consuming.Visual demand inspection must be as

extensive as economically possible.

8/13/2019 Purchasing, Receipt & Inspection of Material

10/11

Cont.....If damage is detected, the transporter

& vendor must be notified immediately,the load must be left intact for their

review.Carry out a cheque against the

purchase order. Notify purchase sectionof any discrepancies immediately.

Carry out basic documentationimmediately, i.e. day-book & inwardgoods register.

8/13/2019 Purchasing, Receipt & Inspection of Material

11/11

Thank You