PL 501 PROCUREMENT IN LOGISTICS & SUPPLY CHAIN

PRESENTATION 1
CHAPTER 2: PROCUREMENT PROCEDURES
PUAN FARIZA BINTI AHMAD MAHYADIN@MAHIDIN

GROUP MEMBERS
NAMES MOHD IQBAL BIN MOHD YAN NORASFARINA BINTI MD SHAH NURUL AFFIQAH BINTI KAMAR NUR SASHILA BINTI MD NOR NUR FATIN AMIRA BINTI ABD SOUD MATRIX NO. 10DLS11F1022 10DLS11F1033 10DLS11F1025 10DLS11F1041 10DLS11F1031

PROCUREMENT ORDER CYCLE STANDARD PROCEDURE

IDENTIFY REQUISITION MATERIAL

DETERMINATION OF SUPPLIER PREPARATION OF PURCHASE ORDER (PO)

FOLLOW UP AND EXPEDITED DELIVERY

PREPARATION OF DOCUMENT

PRODUCT STORAGE

RECEIVE AND HANDLE INVOICE

ISSUES PAYMENT

STEP 1 : IDENTIFY

REQUISITION MATERIAL

WHAT MATERIAL REQUISTION??

A REQUISITION IS A LISTING/BILL OF MATERIAL THAT DEFINES SOME PORTION OF THE PROJECTS MATERIAL REQUIREMENTS. REQUISITIONS ALSO MAY SOURCE MATERIAL ITEMS FROM GENERAL STOCK INVENTORY, AND FROM MANUFACTURED PARTS AND

ASSEMBLIES.
THE COMPANY NEED TO IDENTIFY WHAT A NEED / MATERIALS TO

CAN

THE PRODUCER / MANUFACTURER OF AYAM BRAND SARDINES NEED THE RAW MATERIAL SUCH AS.

WATER

SARDINE FISH

SALT

STEP 2 : DETERMINATION

OF SUPPLIER

COMPANY NEEDS TO DETERMINE THE SOURCE OF THE PRODUCT

WHERE DO PRODUCTS COME FROM ?

THE COMPANY MIGHT HAVE AN APPROVED VENDOR LIST

IF NOT
BUSINESS WILL NEED TO SEARCH FOR A SUPPLIER BY USING THE PO OR RESEARCH A VARIETY OF OTHER SOURCES SUCH AS :MAGAZINE INTERNET

SALE REPRESENTATIV E

PROMOTION FROM FRIENDS

EXAMPLE

CONT...
THE COMPANY WILL CHOOSE THE SUPPLIER TO DETERMINE . . . THE BEST PRODUCT WHICH IT CAN MEET THE REQUIREMENT FOR A BUSINESS

ONCE THE SUPPLIER (ONE OR MORE THAN) HAVE BEEN IDENTIFIED

CAN SUPPLIES INTL CO., LTD KIAN JOO CAN FACTORY BERHAD CAN-ONE BERHAD

CONT...
REQUESTS FOR PROPOSAL S

O R

OR

DIRECT CONTACT MAY BE MADE WITH THE SUPPLIERS

REQUESTS FOR QUOTATION

REQUESTS FOR INFORMATION

REQUESTS FOR TENDER MAY BE ADVERTISED

STEP 3 : PREPARATION

OF PURCHASE ORDER

INVESTIGATE ALL INFORMATION TO DETERMINE THE BEST PRICE AND TERMS FOR THE PRODUCTS BEFORE PREPARING THE PO. DEPEND ON THE COMPANY NEEDS COMMUNITIES

---READILY AVAILABLE PRODUCTS

---SPECIALIZED MATERIALS

BEFORE THEY MAKE A FINAL DECISION, THEY MUST HAVE AT LEAST 3 SUPPLIERS.

CONT
BUSINESS WILL DO THE PO WITH SUPPLIERS SELECTED (SOMETIMES MORE THAN ONE SUPPLIERS) PO USED TO BUY MATERIALS BETWEEN A BUYER AND SELLER.

SPECIFICALLY DEFINES THE PRICE SPECIFICATIONS AND TERMS AND PRODUCT OR SERVICE.

PO DETAILS

PO FORM IN SAP SYSTEM

PO FORM

PO FORM

STEP 4 : FOLLOW

UP AND EXPEDITED DELIVERY

BY USING A DOCUMENT OF PURCHASED ORDER (PO) : DELIVERED VIA MAIL, FAX, EMAIL OR OTHER ELECTRONIC MEANS BOTH PARTIES WILL BE KEEPING A COPY ON FILE FOR RECORD PURPOSE IN THE FUTURE. ADDRESSES THE TIMELINESS OF THE SERVICE OR MATERIAL DELIVERED.

FAX PERSONALLY

MAIL

PO MUST BE DELIVERED VIA...

COURIER

STEP 5 : PREPARATION

OF DOCUMENT

RFP REQUEST FOR PROPOSAL

AN EARLY STAGE IN A PROCUREMENT PROCESS
ISSUING AN INVITATION FOR SUPPLIERS OFTEN THROUGH A BIDDING PROCESS PRESENTS PRELIMINARY COMMODITY OR SERVICE REQUIREMENTS FOR THE

INFORMS SUPPLIERS THAT AN ORGANIZATION / COMPANY IS LOOKING TO PROCURE AND ENCOURAGES THEM TO MAKE THEIR BEST EFFORT

REQUEST FOR PROPOSAL

RFI REQUEST FOR INFORMATION

A PROPOSAL REQUESTED FROM A POTENTIAL SELLER OR A SERVICE PROVIDER TO DETERMINE WHAT PRODUCTS AND SERVICES ARE POTENTIALLY AVAILABLE IN THE MARKETPLACE TO MEET A BUYER'S NEEDS AND TO KNOW THE CAPABILITY OF A SELLER IN TERMS OF OFFERINGS AND STRENGTHS OF THE SELLER.

PURPOSE IS TO COLLECT WRITTEN INFORMATION ABOUT THE CAPABILITIES OF VARIOUS SUPPLIERS.

REQUEST FOR INFORMATION

RFQ REQUEST FOR QUOTATION

USED WHEN DISCUSSIONS WITH BIDDERS ARE NOT REQUIRED (MAINLY WHEN THE SPECIFICATIONS OF A PRODUCT / SERVICE ARE ALREADY KNOWN) AND WHEN THE PRICE IS THE MAIN / ONLY FACTOR IN SELECTING THE SUCCESSFUL BIDDER

SOLICITATIONS
THESE ARE INVITATIONS OF BIDS, REQUESTS FOR QUOTATIONS AND PROPOSALS. MAY SERVE AS A BINDING CONTRACT.

REQUEST FOR QUOTATION FORM

REQUEST FOR QUOTATION (RFQ)

SOLICITATION

OFFERS
THIS TYPE OF PROCUREMENT DOCUMENTS ARE BIDS, PROPOSALS, AND QUOTES MADE BY POTENTIAL SUPPLIERS TO PROSPECTIVE CLIENTS

CONTRACTS
THE FINAL SIGNED AGREEMENTS BETWEEN CLIENTS AND SUPPLIERS.

AMENDMENT / MODIFICATION
ANY CHANGES IN SOLICITATIONS, OFFERS AND CONTRACTS HAVE TO BE IN THE FORM OF WRITTEN DOCUMENT

OFFER

CONTRACT

AMENDMENT TO RFQ / TENDER

STEP 6 : PRODUCT

STORAGE

PRODUCTIONS DEPARTMENT WILL START . . .

THEIR OPERATION TO PRODUCE THE PRODUCT

REQUIRED BY THE CUSTOMERS

CONT...

AFTER PRODUCING OPERATION WAREHOUSEM AN THE SPECIFIC PERSON

CONT
WILL RESPONSIBLE TO MOVE THE PRODUCTS TO THE WAREHOUSE FOR STORAGE PURPOSE
UNTIL IT NEEDED / DEMANDED FROM CUSTOMERS

STEP 7 : RECEIVE AND

HANDLE INVOICE

ONCE THE SENDING COMPANY DELIVERS THE PRODUCT, THE RECIPIENT ACCEPTS OR REJECTS THE ITEM. ACCEPTANCE OF THE ITEMS OBLIGATES THE COMPANY TO PAY FOR THEM. THREE DOCUMENTS MUST MATCH WHEN AN INVOICES REQUESTS PAYMENTS:

THE INVOICE ITSELF

THE RECEIVING DOCUMENTS THE ORIGINAL PURCHASE ORDER. THE AGREEMENT OF THESE DOCUMENTS PROVIDES CONFIRMATION FROM BOTH THE RECEIVER AND SUPPLIER.

DIFFERENCE

Purchase order (PO)

Invoice

I. Legal document "Contract" issued I. Document issued by supplier to a by the buyer to the supplier. customer.
II. It identifies both parties and, it II. It shown indicating specifications, shows the description, quantities, quantities, shipping date & mode, prices shipment date & mode and prices and agreed terms and the payment terms of the items conditions. sold. It serves as a demand for payment

STEP 8 : ISSUES

PAYMENT

IF THERE HAVE NO DISCREPANCY, THEY WILL ISSUED THE PAYMENT BY FOLLOWING THE AMOUNT STATED.

PAYMENT IS MADE IN THE FORM OF CASH, CHECK, BANK TRANSFERS, CREDIT LETTERS OR OTHER TYPE OF ELECTRONIC TRANSFERS.
COMPANY MUST MAINTAIN PROPER RECORDS FOR ANY CASE OF AUDITS. TO VERIFY ANY TAX INFORMATION AND PURCHASE ORDERS TO CONFIRM WARRANTY INFORMATION.

CASH MONEY

CREDIT LETTERS

CHEQUE

BANK TRANSFERS

THANK YOU