Today’s Journal Question ► Why is it important to keep a consistent inventory count? Why is inventory important to ensure a business will succeed?

Inventory Control #2

Purchasing Procedure ► Purchasing is the formal process of buying goods and services for your business or organization ► These goods are then resold, used as raw materials or parts to manufacture other goods, or used up to run the business

► The Purchasing Process can vary from one organization to another but there are some key elements that are common throughout ► The common elements are  Step 1: Requisitioning  Step 2: Quoting  Step 3: Ordering  Step 4: Receiving

We’re out of Paper! ► To exemplify the purchasing procedure we will work through the following example  Acme Accounting Firm is all out of printer and photocopy paper, how do they go about getting more?????

Step 1: Requisitioning ► someone at Acme Accounting realizes we need more paper. ► they put in a formal written request for the paper to the Purchaser (the person who does the purchasing at the business or organization) ► Formal request is usually a business form or memo

Step 2: Quoting (Quote) ► A quote is a request for a price from your suppliers for the object or service you want to purchase ► Your supplier will prepare the quote and send it to you. Then you can decide if you want to purchase from them or someone else ► The quote will come as an official business form

Step 3: Ordering ► After you receive the quotes and you have chosen whom is going to be your supplier, you order the product ► Businesses order products with a business form called a P.O. – Purchase Order ► Acme would sent a Purchase Order to the paper supplier they have chosen. (This is the official order)

Step 4: Receiving ► The final step in the purchasing procedure is to receive the goods. ► This occurs when the goods are delivered or when the service is performed ► It is crucial that someone at the business ensures that the proper goods and amount were received by comparing it to the P.O.