Purchasing is the act of acquiring raw materials, goods, services, and equipment to be able to do business. Why proper purchasing is important to you? Because (1) it can assure the business of continuous flow of input and output, (2) it can minimize the cash tied-up to the unnecessary inventory, (3) it can protect the quality of service/goods of the business, and ultimately, and (4) the business can reap higher profit.
Citing for example, you are operating a sari-sari store and oftentimes you run out of sugar, rice and oil. Sometimes you have to go to the market thrice- a- week to buy these basic commodities. Do you think this kind of buying habit has an impact on your business? Yes it has, try to compute the fare that you spend thrice a week then multiply it by 12 months. If the fare in your place is minimal, maybe you will just say, “oh it’s just a small amount” however, small is amount, if you accumulate it through the years, will turn into a big amount that can be used as an operating capital.
So, how should you buy for the betterment of the business operation? Remember the pointers below;
- 1. Buy at the right TIME – Buy only when the customer and business needs the goods. Do not buy too early nor too late. Proper forecasting of supply is very crucial in operating a business.
- 2. Buy with the right DEALER – Scouting for a good supplier that offers quality and lowest priced goods/services at the right agreement/contract, can really save your business big money. You can ask your neighbour, friends, dealers, and even your competitors as to where they source their goods/services. It doesn’t hurt to ask around first before you start you own hunting.
- 3. Buy the right QUALITY – Buy quality goods that your customer is willing to pay. Do not trade your reputation for short-term gains.
- 4. Buy at the right QUANTITY – Buy quantities the business needs and customer needs and wants. Not too many nor too little.
- 5. Buy at the right PRICE – Buy at prices according to the target market of the business and of course according to what your business can afford.
Always remember a slight variation in your purchasing transaction can have a huge effect on the business’ profitability and sustainability. And aside from saving big on your business, your effort will be minimized too.
Merry Francisco
