PURCHASE PROCEDURE/STEPS IN PURCHASING

 COMMON STEPS FOLLOWED IN PURCHASING MATERIALS 

1. Receiving purchase requisition

      A purchase requisition is a formal request received by the purchasing department from the stores department or production department to purchase a particular material.

2. Selecting suppliers

   Suppliers are selected from list of suppliers maintained, if list is not maintained a tender is issued for submitting quotations for the items to be purchased. 

3. Placing purchase order

       A purchase order is a formal order prepared and sent by the purchasing department to the supplier as per the specifications fixed.

4. Receiving the materials

         Receiving department receives materials and enters all details in the Goods Received Note.GRN is a statement prepared usually by the goods Receiving department showing details of goods received by it.

5.Inspecting the materials. 

       Inspection department inspects the quality of materials and enters all details in Goods Inspection Note.GIN  is a statement prepared usually by the goods Inspection department showing details of quality of goods received by it.

6. Making arrangement for payment. 

    Before making payment, the relevant invoices are checked, after verifying the invoice , the stores Accounting section passes the bills for payment.