Understanding the difference between parts purchasing and parts procurement can make a world of difference to your bottom line.
That’s why knowing the difference between highly used — and equally important —terms as they pertain to the parts procurement industry could save your business time and money.
Terms like “parts purchasing” and “parts procurement” are oftentimes used interchangeably amongst service technicians and parts sales professionals, but that shouldn’t be the case.
Parts purchasing refers to the short-term process of ordering, receiving, and payment for spare parts. On the other hand, the parts procurement process encompasses the steps before, during, and after the purchase process.
Thanks to modern technology, e-procurement systems have been made readily available for repair technicians serving the manufacturing and equipment industries. This availability can significantly increase technician wrench time and decrease equipment downtime.
At least for now, traditional purchasing methods will continue to be standard practice, but automation by using software tools like e-procurement can open the doors to a more streamlined approach.
Further defining the differences between purchasing and procurement will help you make the right choice for your business, regardless if done with e-procurement systems or traditionally.
Parts purchasing involves the ordering and paying-for of specific replacement or spare parts from various vendors and is part of the larger procurement process.
It has become common practice for most fleet owners to source parts by using a standard, and outdated, purchasing process for spare parts.
The process starts with submitting internal purchase-request forms, followed by then putting out the call to different vendors to price parts, and finally sealing the deal.
