Purchasing Department and its responsibilities within a company
Most enterprises own a Purchasing Department in charge of making the daily operations. These departments provide a service as the main activity for industrial organizations. But surprisingly, many staff within a company does not exactly know are the responsibilities of the Purchasing Department, why it exists and how it works. And to understand it better, we will explain some of its functions.
“Purchasing Department in Grupo Denim is in charge of getting all materials needed to develop samples and to run production, from a simple button to the cartons to pack jeans, this department has to be well organized in order to keep all work moving”, says Salomon Juan Marcos Villarreal, president of this acompany, about this department.
Here are some of the main functions of the Purchasing Department:
- Procurement of materials – One of the roles of the Purchasing Department is to provide all needed materials for production and daily operations within a company, for a manufacturer enterprise, this might involve raw materials such as iron, steel, plastics and any tools required, as machinery, trucks and office supplies. This department needs to be careful as investing big amounts of capital for stock might cause storage problems and shortage of capital.
- Assessment of prices – All Purchasing Departments should also evaluate continuously if they are getting materials at the best possible prices to maximize profits. This can get a little complicated for small business as they use to buy in smaller quantities, which means they will get less discounts than the bigger ones, so that is when this department needs to act and negotiate better prices with their vendors.
- Administrative work and accounting – Purchasing Departments handle the administrative work related to purchasing, they need to make sure materials are delivered on time and keep on ordering continuously so the work never stops. In some smaller companies, this department also gets in charge of the Accountant Department to make sure they have enough capital to buy the items they will require, as well as making sure all payments to the vendors are done on time.
“All departments in Grupo Denim are used to act in a teamwork and the Purchasing Department is not an exception, their continuous communication with all other staff is necessary to get all items provided in time and make sure production runs smoothly in order to deliver the orders to our customers right on time”, added Salomon Juan Marcos Villarreal.