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Procurement is the process of buying or otherwise obtaining goods or services, typically for business or government purposes and usually on a relatively large scale. Whether at the supply chain, procurement, or purchasing level, each of these functions plays an essential role in supporting business operations and has a critical impact on profitability. The term procurement is used to reflect the entire purchasing process or cycle, and not just the tactical components
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A clear, practical definition of procurement, with examples and context for finance, operations, and purchasing teams. It’s the tactical execution of ordering from suppliers that were vetted as part of the procurement process Procurement refers to the process that organizations use to find and buy the materials they need to operate
Think of a pharmaceutical lab, for example
Inside that lab you might find all the equipment needed to perform scientific experiments Beakers, test tubes, chemicals, centrifuges, and so on All of this equipment is acquired using a procurement process, typically. The procurement function of an organization operates within a specific, focused area of the supply chain
It encompasses every activity involved in obtaining the goods and services a company needs to support its daily operations. Business procurement includes finding & purchasing materials, products, or services, as well as negotiating, & managing relationships with business partners.
