Current segment
Segment 4.1 Effective Purchasing Practice
Segment 4.1 Effective Purchasing Practice
| Knowledge: Will know and understand | Capabilities: Will be able to |
|---|---|
The typical proportions of organisational costs accounted for by procurements of goods and services |
Explain the importance of procurements of goods and services to the organisation |
Different types of procurements such as:
|
Explain the mix of direct and indirect supplies that are procured by the organisation. Advise internal stakeholders about different types of procurement that the organisation will typically contract |
The five rights of purchasing and definitions of value:
|
Apply the five rights of procurement and value criteria to any purchase of goods or services |
Whole-life asset management criteria, including purchase price, servicing, repairs, consumables, disposal and other end-of-life costs |
Explain how the procurement of goods or services can be evaluated on the basis of whole-life asset management |
The roles of procurement and supply professionals in securing value with suppliers |
Explain the importance of spending the organisation's money with suppliers to achieve best value outcomes |
The roles of staff with devolved responsibilities for the procurement of goods and services |
Identify staff with devolved responsibilities for the procurement of goods and services and explain how they can create orders and agreements with external suppliers |
The main pricing methods used for the purchasing of goods or services including;
|
Explain the advantages and disadvantages of a range of pricing methods and apply these in the procurement of goods and services |
Data that relates to the pricing of goods or services procured by the organisation including:
|
Calculate basic financial analysis of costs and prices and use this data to negotiate with suppliers |
The typical proportions of organisational costs accounted for by procurements of goods and services
Explain the importance of procurements of goods and services to the organisation
Different types of procurements such as:
- Capital and revenue purchases
- Products, services and constructional works
- Direct and indirect
- Outsourcing and insourcing
Explain the mix of direct and indirect supplies that are procured by the organisation. Advise internal stakeholders about different types of procurement that the organisation will typically contract
The five rights of purchasing and definitions of value:
- Price/total cost
- Quality
- Time
- Quantity
- Place
Apply the five rights of procurement and value criteria to any purchase of goods or services
Whole-life asset management criteria, including purchase price, servicing, repairs, consumables, disposal and other end-of-life costs
Explain how the procurement of goods or services can be evaluated on the basis of whole-life asset management
The roles of procurement and supply professionals in securing value with suppliers
Explain the importance of spending the organisation's money with suppliers to achieve best value outcomes
The roles of staff with devolved responsibilities for the procurement of goods and services
Identify staff with devolved responsibilities for the procurement of goods and services and explain how they can create orders and agreements with external suppliers
The main pricing methods used for the purchasing of goods or services including;
- Fixed pricing, lump sum pricing and schedule of rates
- Cost reimbursable and cost plus arrangements
- Variable pricing
- Target pricing
- Risk and reward pricing
Explain the advantages and disadvantages of a range of pricing methods and apply these in the procurement of goods and services
Data that relates to the pricing of goods or services procured by the organisation including:
- Price changes compared to historic figures
- Margins and mark ups
- Whole-life asset management
- Open book costing/accounting
Calculate basic financial analysis of costs and prices and use this data to negotiate with suppliers
This segment was last updated on: 6th November 2024
