What is Procurement?
Procurement is the process a business follows to choose suppliers, order goods or services and pay for them.
Updated
Meaning
English
Procurement is the process a business follows to choose suppliers, order goods or services and pay for them.
Roman Urdu
Procurement woh tareeqa hai jisse karobar supplier chunta hai, maal ka order deta hai aur payment karta hai.
Also called purchasing, buying process.
Example
A restaurant asks three suppliers for rates, orders from the cheapest reliable one, checks the delivery against the order and pays on the due date.
The usual steps
Decide what is needed, ask suppliers for prices, place an order, receive and check the goods, then pay. Checking the delivery against the order before paying avoids short supply and price disputes. Record each purchase with its cost so margins stay correct. See purchase order and GRN.
In Nafaa
Nafaa creates purchase orders, receives goods against them, updates cost and stock, and keeps a ledger for each supplier. See purchasing.
Related terms
- Purchase Order (PO)
A purchase order is a document a buyer sends a supplier listing the items, quantities and agreed prices it wants to buy.
- GRN (Goods Received Note)
A goods received note records what actually arrived from a supplier, checked against the purchase order, before the stock is added and the bill is paid.
- Vendor
A vendor is a person or company that sells goods or services to a business, also called a supplier.
- Supply Chain
A supply chain is the series of steps and businesses that move a product from the maker, through wholesalers and shops, to the final customer.