Guideline in Order To Improve the Purchasing Process to Increase The Operational Efficiency

Abstract

This research aimed to study the problems of the company in this case study in order to suggest guideline to improve the purchasing process and increase the operational efficiency of the organization's urgent purchasing which is currently increasing and affecting the cost of purchasing, the cost of purchasing raw material acquisition, purchasing process problem and quality problem.

The objectives of this study are to 1) study guideline for reducing the purchasing cost and error of the organization's urgent purchasing processes 2) plan and increase the efficiency of raw materials and packaging purchasing of the organization 3) effectively improve the evaluation criteria of raw materials and packaging supplier

The results revealed the causes found in the urgent purchasing processes which are 1) the delay and error in the purchasing request and purchasing order process 2) the urgently needed products from sale department. The researcher has proposed guideline to improve and correct these causes by the methods as followed 1) establishing risk management activity in the purchasing process 2) creating a Purchase Portfolio Analysis to classify products 3) forecasting the raw materials in advance 4) entering the annual sale contract 5) improving the criteria for better supplier evaluation. As a result from the improvement with the proposed guideline can help to decrease the error in the purchasing request process, reduce the cost of product imports, increase the bargaining power with supplier- enhance the planning of beforehand purchasing, add the criteria for better supplier evaluation and help to increase the operational efficiency of the organization's purchasing department