Many people use the terms purchasing and procurement interchangeably, but despite their similarities they do have different meanings. Let‘s clarify any confusion on the difference between procurement and purchasing.
Procurement function commonly encompass: purchase planning, standards determination, specification development, supplier research and selection, value analysis, financing, price negotiation, making the purchase, contract administration, inventory control and stores/disposals and other related functions.
Purchasing may be defined as; that function responsible for obtaining by purchase, lease or other legal means, equipment, materials, supplies and services required by an undertaking for use in the organization. Purchasing is an essential business function that makes the same level of contribution to a firm‘s success as the other major business functions.