What is External Procurement?
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What is External Procurement?
Answer
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External procurement – It is the process of procuring goods or services from external vendors. There are 3 basic forms of external procurement generally supported by the Purchasing component of IT system.
One time orders are generally used for material and services that are ordered irregularly.
Longer-term contracts with the subsequent issue of release orders – For materials that are being ordered regularly and in large quantities, we can negotiate deal with the vendor (seller) for pricing or conditions & record then in a contract. In a contract you also specify the validity date.
Longer-term scheduling agreements and delivery schedules – If a material is ordered on an everyday basis and is to be delivered according to an exact time schedule, then you set up a scheduling agreement.
