If you haven't had a purchasing policy in place since you set up your company, it may be time to think about it. As your business grows, you'll need to supply larger quantities of products and/or services, which means you'll need to set up rules for purchasing management. These rules will enable you to stay on course for greater productivity and profitability. Properly managing your company's purchasing strategy will contribute to the success and sustainability of your project.
Purchasing policy, what are we talking about?
A company's purchasing policy establishes the "general orientations and intentions relating to purchasing and supply, as formulated by the management of the purchasing organization". It is therefore a means of guiding the purchasing manager according to the company's objectives and needs.
Purchasing policy must therefore meet a number of operational and organizational imperatives and objectives. To be viable, it must also take into account the available financial resources and their distribution. To this end, it must be established along the following 3 axes: + Provide the best possible solution to the company's purchasing needs. Defining needs is an essential step, which must be complemented by an appropriate purchasing process. + Establish good relations with suppliers. Strengthening relationships by including suppliers in the purchasing strategy offers good prospects for the company's future. + Adopting an innovative and responsible purchasing policy to anchor a sustainable approach.
Thanks to this strategy, the purchasing department can then select the most appropriate levers to respond to the various imperatives and needs according to the evolution of the supplier market.
Establish an effective purchasing policy
Analyze existing
Implementing a purchasing policy doesn't happen overnight. First and foremost, it's essential to gather certain data, analyze them and extract the necessary information.
This means first analyzing internal data, such as spending history by supplier, or even by item. Next, it's important to find out about the supplier market and how it's evolving. Finally, it's vital to seek out all information on the legal framework governing trade, as some business sectors are more concerned than others by specific restrictions or declarations.
Establish a concrete and effective action plan
Once you've analyzed the existing situation, it's time to set quantifiable and measurable objectives. You'll also need to specify a deadline for achieving them. And don't forget to put in place the various indicators that will enable you to assess the impact of the changes you've implemented.
Here are 4 steps to follow to establish an effective action plan over the long term: 1. define each action to be organized according to the objectives sought 2. create suitable tools to monitor results on a daily basis 3. allocate tasks and responsibilities to each person in order to achieve optimum efficiency 4. inform suppliers of the implementation of this new purchasing policy.
Defining purchasing ethics
Implementing an effective purchasing strategy also means determining the company's purchasing ethics. This ensures smooth, seamless operation throughout the purchasing process, and enhances transparency. In this way, you will project a professional image to suppliers, who will have every confidence in your company.
Establishing rules and procedures: the Code of Ethics
All purchasing rules and procedures must be set out in a code of conduct. To be complete and perfectly transparent, this document must be drafted along the following lines: + criteria for evaluating and selecting different suppliers + involvement required of suppliers upstream + method of communication with suppliers + intellectual and industrial property + supplier consultation frequencies + contractualization principles + main contractual clauses + principles for challenging suppliers + procurement policy + general purchasing conditions + ethics and good conduct.
The purpose of this code of conduct is to provide suppliers with clear information, so that they know what they're getting into when they work with your company. It's a way of laying the foundations for a lasting relationship, since only suppliers who can operate in line with your rules of ethics will agree to work with you.
Supplier relations
Internally, a certain code of ethics must also be observed to ensure that relations with suppliers continue under the best possible conditions. To this end, your team must ensure a certain degree of fairness between suppliers: + similar requests for information + sending of similar files + identical access to information + negotiations conducted in the same way.
In this way, the purchasing department can maintain good relations while obtaining the best offers on the market.
Enforce new measures and monitor their impact
Once you've defined the objectives, drawn up the various documents and created the monitoring tools, the next step is to implement these new initiatives in the company's day-to-day operations. To do this, you'll need to: + inform your staff of these new provisions and train them where necessary + deploy the new tools + communicate with all your suppliers and pass on the code of conduct to them.
Once the purchasing strategy has been put in place, monitor the results on a regular basis so that you can adapt certain points if necessary.
Purchasing policy has a real influence on a company's development and results. Indeed, the relationship with suppliers and the focus chosen for product selection are at the origin of your business. That's why it's so important to get the rules right, so that your purchasing strategy is consistent with your company's overall policy and brand image. Consistency remains one of the key factors of success, whatever your field of activity.
