procurement2

Question 1

methods of purchasing

Answer 1

informal/open market, formal competitive bid

Question 2

what is informal/open market?

Answer 2

involves ordering needed food and supplies from selected list of vendors on daily, weekly, biweekly, or monthly price quotations

Question 3

informal used when ___ is an important factor

Answer 3

time

Question 4

informal is common in ___

Answer 4

smaller restaurants, private institutions, commercial ops

Question 5

informal usually done under these circumstances:

Answer 5

amount of purchase small, an item only can be from a couple sources, need is urgent, stability of market uncertain, size of op too small

Question 6

what is formal competitive bid buying?

Answer 6

buyer selects group of suppliers, written specs and estimated quantities needed are submitted to suppliers with invitation for them to quote prices, suppliers compete over price quotations on buyers specs, buyer decides, formal contract

Question 7

formal need to consider ___

Answer 7

legal considerations

Question 8

formal common in:

Answer 8

school sys, correctional institutions, hospitals (tax-supported places)

Question 9

advantages of formal?

Answer 9

reduce misunderstanding due to quality, price, delivery; cost savings by buying bulk, good for standing orders (pay at regular intervals)

Question 10

disadvantages of formal?

Answer 10

time consuming, not practical for perishable items cuz day to day fluctuation in market price, dishonesty when involve large amt money

Question 11

what is line item bidding?

Answer 11

choose suppliers with lowest price item by item

Question 12

what is all or nothing bidding?

Answer 12

whole line of items, choose supplier with lowest price on all

Question 13

what are diff buying methods?

Answer 13

independent purchasing, group purchasing, centralized purchasing, warehouse club, JIT

Question 14

what is independent purchasing?

Answer 14

done by unit or department of org that has been authorized to purchase

Question 15

advantage of independent?

Answer 15

sole responsibility and authority for purchase without need for multi org lvls approval

Question 16

what is centralized?

Answer 16

purchasing activity done by one person or department (head of dpt report directly to top mngmt, has responsibility make profit)

Question 17

examples of centralized?

Answer 17

stores/procurement dpt in hospital; stores/supplies in uni

Question 18

advantages centralized?

Answer 18

better control, development of personnel just responsible for purchasing, better performance in other dpt without additional need to procure, more economical/profit

Question 19

what is grp purchasing?

Answer 19

2+ independent orgs combine to buy together, involving bring together foodservice managers from diff ops/schools, most often onsite foodservices, for joint purchase

Question 20

example group purchase?

Answer 20

sakatoon health region long term care

Question 21

advantages group?

Answer 21

increased leverage, buy at lower price, reduced contact with sales reps, time savings, update specifications

Question 22

disadvantages group?

Answer 22

may require central warehouse unless grp large enough, must agree specs/bid schedule, food preferences differ

Question 23

goals of JIT?

Answer 23

secure steady flow raw materials, reduce lead time required ordering product, reduce amt inventory in storage/production, reduce cost associated w/ storage

Question 24

what are stages of supplier selection and evaluation?

Answer 24

survey–>inquiry–>supplier performance evaluation

Question 25

what is survey stage?

Answer 25

explore all possible sources for product, examine records of experience with suppliers (consider incorrect orders, handles emergency)

Question 26

what is inquiry stage?

Answer 26

compare suppliers for quality, quantity, price, time; narrow list from possible to acceptable

Question 27

what is supplier performance evaluation?

Answer 27

meeting performance standards? New ones considered for future?