How to Create A Procurement Plan

Importance of creating a procurement plan

We aren’t fans of giving any credit to COVID-19 but it did teach our industry some valuable lessons; one of these being the importance of supply chain visibility. True transparency can be achieved when e-commerce businesses are able to access and gain insights into not only their data but connected data from manufacturers all the way through to the systems handling product delivery.

Laying out a procurement plan is key to this visibility and to be clear, a procurement plan is a process of finding and selecting a vendor.

Elements of a proper procurement plan

A robust procurement plan is made up of the following parts:

1. A contract
2. A selected metric to judge supplier performance (learn how to choose the right supplier)
3. Clear organisational standards
4. Planned delivery and implementation dates for products to go live
5. Identified number of suppliers and the assigned manager for these
6. Awareness of potential constraints and hazards
7. Fully cleared list of vendors
8. Lead times measured against each stage of the project

All of these features are present in a good demand forecasting software and tool available online.

A robust procurement plan allows for e-commerce businesses to more effectively withstand economic shifts such as recession and inflation but additionally, environmental shocks such as a material shortage.

A good procurement plan also helps in planning inventory for the holiday season as well.

Here are the challenges that a procurement plan must mitigate

Feeling confident in your procurement plan should allow you to tackle whatever might come your way. Here are the risks a procurement plan should allow you to mitigate (meteor landing on earth is not included:P) :

• Incorrect product delivery times
• Low quality goods
• Inability to react quickly change
• Siloed systems
• Environmental or economic crises

At Prediko, we not only have an easy way to map all your products to suppliers and log all the information about them in one place, but we also calculate deadlines for delivery taking all this information into account.

No more calculations, re-calculations and last minute changes. You know when you need to order, how much and till when it will last you. All the lead times included.

If you have a question concerning your procurement plan, DM us on any of our social media channels and a team member will be sure to respond.