Procurement is the activity of finding and acquiring goods and services. Its aim is to ensure a company makes and delivers products or services at the right time, right price and best cost so that customers are satisfied and the company makes a profit.
Managing the procurement process involves:
- Preparation—planning and predicting future needs
- Implementation—shipping, receiving, handling and storing goods
- Task management—ensuring every employee is doing the right task
- Follow-up—ensuring expected results and goals are achieved
Procurement activities may relate to the acquisition of physical goods or may be information-based (related to ordering, invoicing and the like). Information-based procurement activities are considered administrative.