To procure, is to acquire or obtain. So if you are in a position of procuring, you are probably in a position of acquiring or obtaining goods and materials for the business. We’re not talking about going clothes shopping and getting paid for it (although retail stores do need purchasers), it’s more like buying company equipment, dealing with wholesalers for inventory and overseeing all purchases in accounts receivable and payable. Don’t know what AR and AP are? Take the course an introduction to financial accounting to find out. Ever wonder how a store chooses what to carry? Those kinds of decisions are typically made by those in the procurement department. Like most jobs, there are management roles, assistant roles and clerks.
As the purchasing manager you have several obligations and responsibilities. You are, after all, in charge of the entire purchasing department. Without you, business doesn’t happen. The title may differ company to company, but generally speaking you are either the Purchasing Manager, Procurement Manager or Chief Procurement Officer (CPO). The procurement manager is in charge of developing strategies for using the company money most effectively and dealing with any suppliers. The procurement manage also:
- Recruits staff and trains them
- Manages any Service Level Agreements (SLA’s) which are contracts that exist between the suppliers and the company being supplied
- Communicates frequently with the accounting and manufacturing departments to ensure the money is available to purchase goods and to verify the quantity or quality of the goods to be bought.
- Chooses suppliers for the company (like Target signed a contract with Kate Spade a few years ago) that the company deals with and manages any legal interactions necessary.
- Budgets costs for goods and associated expenses
- Studies financial trends of the company to ensure better use of company funds (Check out business analytics, a course to help you make sense of all the data.)
Procurement managers can make $120,000 a year, give or take. Don’t expect to start out making that much though! The more you know, the more you can make. Test your skills in the course business mathematics and learn about financial forecasting, reporting and trends.
Purchasing Admin Assistant
Many administrative assistants act in support roles for management of a department. Like a medical administrative assistant is responsible for greeting customers, answering phones, appointment booking and paperwork – procurement admin assistants do similar things. Their tasks are generally less interesting and less taxing, but they are necessary to ensure the department functions properly. A procurement admin assistant may:
- Manage all phone calls, faxes and emails
- File and create documents as delegated by the procurement manager
- Maintain the office, keep it clean and organized
- Assist any customers that may need help
- Plan meetings, invite all meeting attendees, keep minutes and records of the meetings
- Help the manager make small purchases and review inventory
- Data entry
Procurement administrative assistants get paid, on average, a little more than other departmental assistants. The pay can start at $10-$15 an hour depending on the level of experience (LOE) and type of industry. This is vastly different than that of a manager so if you stay with the company long enough to learn the ropes there is a lot of room for growth – and more money.
The clerk does the bulk of the work for the procurement department. They are the working horse that fulfills the manager’s needs and relies on the administrative assistant for extra help. The clerk’s job is mostly logistical and tactical and requires someone who has solid knowledge about the business of procurement. The clerk is expected to:
- Organize purchasing orders and requests for purchase orders of goods and materials
- Contact suppliers with a request for purchase
- Review the company inventory to see what needs to be purchased
- Order necessary company products and supplies
- Monitor income deliveries against purchased goods to make sure there is no discrepancy
- Track orders
- Manage orders that were never purchased, never delivered or damaged upon arrival
- Communicate with accounts receivable and accounts payable to make sure money is flowing as it should be (in the course learn accounting – understand business you will gain more insight into how crucial maintaining a good relationship with the accounting department is)
- Create and maintain any reports to document material traffic
Procurement clerks average salary is somewhere around $35,000. The range shows to be from as low as $22,000 to as high as $49,000 depending on the industry and level of experience.
In larger companies, purchasing agents may be required to obtain raw material for operational purposes. These agents are also usually responsible for contracting cleaning services to keep the office building clean and maintenance when necessary. Purchasing agents can be found in governmental organizations, hospitals, universities and larger corporations who need someone to oversee all of the details of purchasing services. The average salary rests comfortably around $50,000.
Anyone working in the procurement department should have excellent communication skills, the ability to keep organized and knowledge of the financial industry. Procurement is much more complex than just buying goods and keeping track of what’s purchased. A keen eye for detail and negotiating skills will get an individual quite far in the business of procurement. Why negotiating? The nature of procurement relies on a good sales technique and someone who isn’t afraid to negotiate cost. One of the important facets of the procurement department is being responsible with company money and finding the best ways to spend less and save more. Clients have the same perspective, they want to sell their goods at high prices to increase their profit margins. With good negotiating skills the procurement manager or clerk can find common ground between the client’s expectations and the company’s budget to seal the deal. Clerk or manager should also have some experience with project management. The purchasing of goods is kind of like one huge long-term project.
Test your project management skills in this Project Management Professional (PMP) practice exam.