- Project plans
- Project activities
- Legislation and standards
- Industry context
Last edited 16 Mar 2021
Corporate objectives for procurement
Procurement involves the purchase goods or services. It must be carefully managed to ensure value is obtained, the correct goods or services are purchased, a high level of quality is received, timescales are met and good relationships are maintained between the procurer and the supplier. Establishing a procurement strategy at the outset is key to a successful outcome.
 Five objectives of corporate procurement
One approach to the corporate objectives for purchasing includes five basic principles. These are sometimes referred to the five Rs:
The most appropriate items for a project may not always be the most expensive or the highest quality. Suitability is instead based on a combination of factors, including cost, characteristics and application requirements. These factors should be established by personnel who are knowledgeable in the business and technical aspects of the project and are able to verify the quality of items supplied.
Accurate purchasing can be based on a type of inventory management referred to as economic ordering quantity (EOQ). When calculated properly, the EOQ formula can help an organisation keep the size of an order at a minimum while still maintaining enough inventory to support the activities of the project.
 Right time
The timing of purchases should be scheduled so materials are available - in the proper quantities and at the appropriate time. Inventory management methods should be put in place to trigger reordering based on historical data that tracks both material usage rates and necessary lead time (for delivery purposes). Since carrying excess inventory can be costly, it’s important to track this data closely and accurately.
 Right source
Selecting the most suitable vendor can not only contribute to a beneficial outcome, it can also help establish a self sustaining procurement strategy. Vendors can serve as partners who inform clients about possible factors - such as supply chain interruptions, pricing changes, additional potential partners and so on - that may have an impact on market conditions linked to the outcome of a project.
 Related articles on Designing Buildings Wiki
Featured articles and news
It shouldn't be so difficult to find PPE that fits properly.
Pivoting infrastructure technology stands up to the test of time.
TASC/CIOB study looks at post-pandemic struggles and trends.
The Government announces recalibrated goals.
ECA proposes strategies for the present and the future.
Paul Morrell to lead independent review of the construction products testing regime.
Standard will help employers foster wellbeing and manage psychosocial risks.
Global fire standards for safety of people and property.
An introduction to the 5 core principles of lean.
Can the profession use its skills to save the world from climate change?
How faulty science resulted in sanitation reform.
Improving facilities, accessibility and overall appearance.
Free download of TG 12/2021 available.
TESP works with The Youth Group to form skill sharing network.
Click the button to subscribe.