Purchase Process Flow Chart Doc

A purchase process flow chart is a visual representation of the sequential steps involved in the procurement process. This document is typically used to ensure that the entire purchasing procedure is standardized, transparent, and efficient. By outlining each stage in the purchasing process, from the initial request to the final payment, organizations can streamline operations, identify bottlenecks, and ensure compliance.

The key stages generally included in a purchase process flow chart are:

• Request for Purchase: This step involves identifying the need for a product or service. A Purchase Requisition Form (PRF) is typically filled out and submitted by the requesting department.
• Approval of Request: Once the PRF is submitted, it needs to be approved by a supervisor or an authorized individual. Depending on the organization's structure, multiple levels of approval may be necessary.
• Supplier Selection: After receiving approval, the procurement department identifies and evaluates potential suppliers. This might include sending out Requests for Quotations (RFQs) and comparing received bids.
• Purchase Order Creation: Once a supplier is selected, a formal Purchase Order (PO) is created detailing the items, quantities, prices, delivery dates, and terms and conditions.
• Order Dispatch to Supplier: The PO is dispatched to the selected supplier, initiating the actual purchase.
• Order Fulfillment: The supplier processes the PO and fulfills the order by delivering the goods or services as specified in the contract.
• Receipt and Inspection: The received goods are inspected to ensure they meet the specified quality and quantity requirements. Any discrepancies are noted and communicated to the supplier.
• Invoice Processing: Once the order is confirmed to be satisfactory, the supplier sends an invoice for payment. This invoice is matched against the PO and the receiving report.
• Payment to Supplier: After verifying that the invoice is accurate and that the goods/services have been received as per the agreement, payment is made to the supplier.
• Record Keeping: All documents related to the purchase, including PRFs, POs, invoices, and inspection reports, are archived for audit and reference purposes.

Having a purchase process flow chart document aids in establishing a clear, orderly, and efficient procurement process. It ensures that everyone involved knows their role and responsibilities, aids in compliance with organizational policies, and provides a quick reference for training new employees.