Expert answer:Present a complete procurement management process
Solved by verified expert:For this option, you will write a paper presenting a complete procurement management process. The paper will be based on the procurement practices of an organization you have researched. The elements you must include are: Requirements – Planning the procurementRequisitions – Conducting the procurementSolicitations – Requesting seller responseAwards – Selecting sellersAdministrationContracts, Incentives and RisksQuality and Closure Your paper must have: An introduction. Use your introduction to summarize and define your topic, including a clear statement of the procurement goal.A discussion or body that must include:A discussion of the implications of proposed solutions for procurement and contracts. A discussion of how procurement works within project teams to facilitate the needs of projects.Your evaluation and conclusions regarding possible methods of managing or addressing the problem raised by your opinion on the issues (supported by research). Relate your paper to larger (broader) procurement and contract management issues as found in the course readings. Current, relevant research from at least six to eight credible sources. At least three references must be peer-reviewed, scholarly sources, and the rest may be trade or professional procurement management sources. Cite and reference all sources used. The paper is expected to provide a thoughtful analysis on the topic. You are encouraged to add your own opinions, but these should be carefully considered and supported by evidence or outside rationale. A conclusion. Your paper should be eight to ten pages in length (not counting the cover and reference pages that you must include)
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Running head: PROCUREMENT AND CONTRACTING
Procurement and Contracting
Institutional Affiliation
Date
1
PROCUREMENT AND CONTRACTING
2
Mutual Agreement of Offer and Acceptance
Wal-Mart is an international company that operates in various nations around the world,
selling a wide range of products in its stores and hypermarkets. Walmart is the highest earning
revenue company in the world and the employer of more than two million employees across the
globe. The low-price consideration as well as offering quality and time-saving services creates a
sense of customer comfort ability and loyalty as well to the overall. Walmart uses procurement
and contracting process in communicating to its stakeholders who deal directly on the line of
production; such stakeholders are suppliers and customers. Walmart needs to identify what
products are out of stock. This will enable it to establish a requirement, and then presents an
offer and wait for acceptance. In the procurement procedures that Walmart will carry out on the
requisite elements established to express creation of a legally binding contract with a mutual
agreement of offer and acceptance.
Walmart will present an offer demonstrating an expression of willingness to agree on
definite terms, made with the purpose that will become binding immediately accepted by an
individual to whom it is addressed. For instance, when dealing with suppliers, Walmart will have
to present what the business is short off in the stock. Acceptance happens when an offeree
concurs to be jointly bound to the contract terms by sending off consideration, to close the deal.
Such acceptance between Walmart and its supplier will have to meet the following conditions:
Acceptance has to be communicated. The order that had been placed by the supermarket
must be communicated by the supplier as a show of executing the remaining criteria of closing
the deal. Additionally, the offer made by the business will only be accepted by the supplier, that
is, the supplier to whom the offer was purposely made. On the other hand, acceptance can be
contingent from conduct between the supermarket and the supplier. Additionally, acceptance will
PROCUREMENT AND CONTRACTING
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have to be determined by a consideration whereby suppliers should have the ability to offer a
price which will confirm that such a deal will be closed in the due course. Therefore, the
procurement process will be complete only if the parties determined to be lawfully bound, and
then they arrive at a satisfactory agreement devoid of any additional requirement.
The Consideration of a Down Payment
The business through its term of marketing experts will have to consider the credibility of
customers and suppliers before consideration of down payment. For instance, elements to
consider in a payment when dealing customers are not limited to their historical background of
creditworthiness. When such historical background of creditworthiness is worthy, then customers
will have acquired goods with a down payment (Babich & Yang, 2017). This is carried out in
two ways. The first way the customer is allowed to pay in installments and after paying the total
amount for the merchandise, one can go ahead and carry the merchandise. The second option
involves allowing the customer to carry with him or her product after paying a given amount as a
down payment. The customer pays the remaining amount while he or she is already using the
product. This is especially advanced to customers who have a long relationship with the store or
have been proven to be credit-worthiness.
Another factor Walmart to consider in the down payment to its consumers is the amount
of stock remaining and the financial ability at the moment for it to acquire another stock from its
potential suppliers. Thus Walmart will only accept down payment when there is a financial
ability to get other goods.
The Capability to Perform the Work
The supermarket also considers how long it took the suppliers to produce a product, and
this is as well done through market analysis by marketing experts of the business. First, Walmart
PROCUREMENT AND CONTRACTING
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will have to determine financial ability of such supplier by requesting financial statements. This
will tell the ability that such a contract will remain enforced and bidding (Hurst, Sharpe &
Yeager, 2017). Also, Walmart will have to consider other performance indicators of the supplier.
Such indicators will include its management, employees and other external along with internal
factors of the company. For instance, an involvement of management will see their
accountability on company resource that Walmart will not risk having a bidding contract with
incompetent management of supplier that will then unable to meet the procurement requirement
of the business.
Finally, the working staffs of that supplier that is to enter have a legal binding contract
with. This is because the production of any given company is determined by its workforce. The
workforce is the pillar of the perforce in that, they determine the failure and the success of the
entire business. Therefore, the ability to perform the work will not limit to the working forces of
such human resources of its supplier. However, when they are incompetent, Walmart will not
risk its potentiality and competitiveness to have a mutual and binding contract with such kind of
supplier.
The Confirmation of Legal Purpose
A procurement process will have to be completed when all elements surrounding
business environment meets all requirement of the law. Walmart should confirm the legal
requirement of its partner before concluding the deal (Kim & Brown, 2017). Additionally, the
major purpose of the legal requirement is to make sure that such a deal does not involve fraud
and unethical issues of running and conducting business. Additionally, a confirmation will
involve if such supplier has been still complying with the code of business conduct and as well
PROCUREMENT AND CONTRACTING
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fulfills ethical responsibilities. Therefore, after Walmart have confirmed all legal elements, then
the deal will have to be closed.
PROCUREMENT AND CONTRACTING
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References
Babich, V., & Yang, Z. B. (2017). Supply Disruptions and Procurement Contracting. In
Handbook of Information Exchange in Supply Chain Management (pp. 145-170).
Springer International Publishing.
Hurst, D., Sharpe, S., & Yeager, V. A. (2017). Administrative Preparedness Strategies:
Expediting Procurement and Contracting Cycle Times During an Emergency. Public
Health Reports, 132(3), 294-297.
Kim, Y. W., & Brown, T. (2017). Autonomy versus control in procurement and contracting: the
use of cost-reimbursement contracts in three US federal departments. International
Review of Administrative Sciences, 83(1_suppl), 41-58.
Running head: THE PROCUREMENT PROCESS
The Procurement Process
Institution Affiliation
Date
1
THE PROCUREMENT PROCESS
A. Planning the procurement is the procedure of making a decision on:
i.
What to buy. What to buy in the business is determined by the quantity of available
stock and the market forces of demand and supply of such kind of product
ii.
When to buy. When to buy is determined with urgency of the order plus time that
will take to complete the procurement process
iii.
And from what source. The plans of how to complete the process of procurement are
as well; determined by the sources of goods under procurement. When the source
cannot be established easily, then procurement process will take longer.
iv.
During the procurement planning process, the procurement method is assigned and
the expectations for the fulfillment of procurement requirements determined.
B. Requisitions – Conducting the procurement
i. Conducting procurement entails various elements that will determine the efficiency and
effectiveness of the procurement process.
ii. Also, conducting procurement will involve all interested parties from two interested
parties presenting all relevant required documents
C. Solicitations – Requesting seller response
i.
When requesting seller response is the time when procurement process will be on its
due course
ii.
The seller response will be determined when the seller would have met all the
requirements that were in the process
D. Awards – Selecting sellers
i.
In awarding the contract, all legal factors must be considered. A seller who would
have met all stipulated terms and conditions will be selected
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THE PROCUREMENT PROCESS
E. Administration
i.
It will be then the responsibility of the administration to make sure that, funds are
disbursed on time to facilitated completion of procurement process
F. Contracts, Incentives, and Risks
i.
The contract will be signed and remain in force
ii.
Incentives will be as well granted to the seller as a way of motivating for efficient
and effective service delivery
iii.
Mitigation will be put in place for any chances of risk occurrence
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Running head: PROCUREMENT MANAGEMENT PROCESS
Procurement Management Process
Institution Affiliation
Date
1
PROCUREMENT MANAGEMENT PROCESS
Part 1
Walmart is an international company that operates in very many countries around the
world, selling a wide range of products in its stores and hypermarkets. Walmart is the highest
earning revenue company in the world and the employer of more than two million employees
across the globe. It has a chain of operation in hypermarkets, grocery shops, and discount
departmental stores. The low-price consideration as well as offering quality and time-saving
services creates a sense of customer comfort ability and loyalty as well to the overall
company (Spicer & Hyatt, 2017). Walmart has a brand name in the current business
operations and a wide market share across the globe.
Their vision statement is “To be the best retailer in the hearts and minds of consumers
and employees.” Per the company’s vision, it aims to create full satisfaction to its clients
which can be gained by providing products at affordable price, maintain uniqueness and
maintain high quality. On the other hand, the mission statement is, saving people money so
they can live better (Spicer & Hyatt, 2017). This indicates that the overall aim is to hold
prices low and ensure that their customers enjoy the product prices. The company however
also constantly aims to ensure that products are obtained faster through cheap and better
means.
Part 2
Q. Describe how to a) establish, b) create, and c) organize project requirements.
Project requirements in a procurement process are mostly associated with the needs of
an organization. An organization needs to identify what products they need that is out of
stock. These products can also be new products that the organization intends to introduce in
their stock. In order to establish a requirement, Walmart most of the time put several things
into consideration through observing. They first take note of a product that is out of stock.
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PROCUREMENT MANAGEMENT PROCESS
This is, however, not enough to reorder it. The supermarket also considers how long it
took the product to be sold. If this time is too long, then they conclude that the product is not
one that is usually mostly used. They thus eliminate it from their requirements. This is
usually to ensure that they do not have inventory constantly lying around. If the product is
however usually sold out very fast, they establish and create this product as a requirement.
This is because products that go out of stock faster are needed more by customers. Failure to
have them available in the supermarket will have a bad impression on the customers. This
might ruin the organization’s reputation. In terms of organizing the project requirements, the
products on high demand are prioritized over those whose demands are low. The needs of the
customers are thus met promptly. It also saves the supermarket money as it does not buy
products that are not, in turn, sold faster.
Q. Explain how to locate and identify a) sources of supply, b) suppliers, c) marketplaces,
and d) competition.
In order to identify good sources of supply and suppliers, Walmart gathers
information about various suppliers. This information includes their charges, quality of their
goods and reliability (Kumar & Pani, 2014). This information is mainly gathered from other
businesses that have dealt with these suppliers before. Walmart interrogates these businesses
about the experience they had with these suppliers, their overall perception of these suppliers
and whether it is advisable to engage them in business. After getting this information,
Walmart weighs the pros and cons of choosing particular suppliers and finally makes a
decision. They also test the suppliers’ goods for the purpose of ascertaining the quality
(Kumar & Pani, 2014). If the quality of products is good, the suppliers are reliable and their
charges are reasonable, then Walmart starts sourcing from these suppliers.
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PROCUREMENT MANAGEMENT PROCESS
When it comes to marketing, Walmart is moving away from indiscriminate marketing
through advertisements towards identifying their market. Walmart thus does a thorough
analysis of the products that it intends to sell and considers who the products are likely to be
useful too. They consider mainly the age and the purchasing power of their potential
customers. This is mainly done through observation of the type of people who make most
purchases of their products. Target marketing has thus helped Walmart to focus on the
customers that are likely to earn them a lot of money. This saves money for the supermarket
as it does not waste it on marketing to people who do not add any value to the supermarket,
as they used to before.
In order to identify competition, Walmart usually does a survey of its customers. The
questions asked are such as the supermarkets that the customers prefer shopping at. The
customers are also asked why they prefer shopping at these places. The answers that are
usually given usually pertain to customer service, the difference in prices and the availability
of commodities. Walmart thus tries to know more about these companies, especially which
competitive strategies they use. After this exercise, Walmart comes up with a strategy on how
to maintain the customers they have and how to attract others. Through the consideration of
all the above factors, the procurement process of Walmart is usually completed and is also
very effective.
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PROCUREMENT MANAGEMENT PROCESS
References
Kumar Kar, A., & K. Pani, A. (2014). Exploring the importance of different supplier
selection criteria. Management Research Review, 37(1), 89-105.
Spicer, A., & Hyatt, D. (2017). Walmart’s Emergent Low-Cost Sustainable Product
Strategy. California Management Review, 59(2), 116-141.
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