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Jemshah
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Asked: 2023-01-08T04:58:04+00:00 In:

One of the objectives of the purchasing function is to obtain materials at a competitive market price. Explain five ways in which a procurement officer may achieve this objective.(10 marks)July 2020

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One of the objectives of the purchasing function is to obtain materials at a competitive
market price. Explain five ways in which a procurement officer may achieve this objective.(10 marks)July 2020

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    1. Source from multiple suppliers: By sourcing materials from multiple suppliers, the procurement officer can increase competition among suppliers, which can drive down prices.
    2. Negotiate favorable terms: By negotiating favorable terms such as bulk discounts or long-term contracts, the procurement officer can secure lower prices for the organization.
    3. Leverage purchasing power: By aggregating demand for materials across the organization, the procurement officer can leverage the organization’s purchasing power to negotiate better prices with suppliers.
    4. Use reverse auctions: By using reverse auctions or other competitive bidding processes, the procurement officer can encourage suppliers to offer the lowest possible prices for materials.
    5. Utilize e-procurement platforms: By using e-procurement platforms, the procurement officer can access a larger pool of suppliers and can facilitate price comparisons and negotiations in real-time.
    6. Utilize strategic sourcing: By implementing strategic sourcing techniques, such as analyzing the total cost of ownership and identifying opportunities for cost-saving substitutions, the procurement officer can identify opportunities to reduce the organization’s materials costs.
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