Get Your Purchasing in Order: 5 Common Procurement Problems

Categories : Procurement Goals
  • Tags : Reduce Risk | Set Strategy
Published on : Sep 20 2017

By: Brittany Whitmore, Communications and Community Manager at Procurify

A reliable procurement system is designed for speed, efficiency, and accuracy. Yet despite all precautions, problems ranging from human error to organizational shortcomings can still have a negative effect on a company’s procurement and purchasing ability. Here are five common procurement problems you’ll encounter as well as simple ways to fix them.

1. Accidental Orders

Did you order the wrong item? Or the wrong quantity? If you have a good relationship with your supplier, immediately follow up to admit the mistake and rectify the order. This can save you from considerable hardship in the long run. Given the speed of transactions these days, ordering errors are common and require checks and balances that throughout your supply chain. Adopting a protocol that allows for approval from more than one person is one safeguard against mistakes like this in the future.

2. Inflexible Suppliers

Many procurement decisions correlate to a company’s risk management strategy. The lower the costs, the better they’re reflected on the bottom line. Suppliers who recognize that accommodate a company’s needs to maximize their performance. Still, some suppliers may not offer discounts or insist that certain surcharges be included in the price. Before opting for a rigid supplier, consider other negotiation options. Can the supplier pay for shipping? Are discounts available for larger bulk orders? A skilled procurement professional like yourself will often find some wiggle room for negotiation and you’ll look good doing it.

3. Exceeding Budget

Chances are, procurement transactions that exceed your budget aren’t due to reckless spending. It’s more likely that a communication (or coordination gap) is present in your procurement protocol. This should be addressed as soon as possible. Regular budgetary updates affecting the financial status of all links in your supply chain, including budgetary changes, will go a long way towards rectifying that problem.

Click here to read about the additional 2 problems

About Brittany Whitmore

Brittany believes in the power of creativity and innovation and initially dove into entrepreneurship running a successful marketing company. She currently handles communications and community management for Procurify, and also supports her community through mentoring, volunteering and community events.