ISCOM 361

Purchasing Document Matrix

TEam C

Purchasing Document Matrix Summary

Supplier Quotation

The Supplier Quotation is a document to determine if the supplier will be selected to have the part sourced to them to use. It is a formal statement stating that the supplier has legally consented to supply goods and services at the price and period specified. This document is created during a few different circumstances/stages.

Stage 1-Upon design release to establish cost or support a target cost model.

Stage 2-When demand is present in the system and there is no supplier identified.

Stage 3-If the quote in the system is deemed old and needs to be refreshed based on an established cycle of when quote is still valid.

Stage 4-When part has somehow been changed, possibly rolled revision and need to validate cost against revised drawing.

Buyer creates and send off to supplier for completion and once the supplier completes the quote, it is provided back to the buyer for input in to the system (Supplier Quotation, 2017).

Purchasing Requisition Process

Before a purchase order gets placed, the demand gets loaded into our ERP system that is triggered from a sales order. Once the PR has been generated the buyer will get notified by an alert via email and the through our ERP system in their business workplace. Once the buyer receives their PR, they will need to prepare the request for quotation from their suppliers.

· Material control specialist generates a purchase request (PR) from a sales order

· Buyer receives the purchase request (PR) in their business workplace

· Buyer sends the supplier(s) request for quotation (RFQ)

· Buyer accepts the quotation and places the purchase order (PO) (Johnson, & Flynn, 2014).

Purchase Order

A purchase order is a commercial document that specifies the types, quantities, and prices for products and services. It is used to control the purchasing of products and services from outside suppliers/vendors and confirms the placed order. This document is the first official offer issued initiating a transaction, once the purchase requisition has been approved by the businesses purchasing department. It is initiated and created by the buyer or purchasing department and is then sent and received by the seller, or vendor (Chron, 2018).

Invoice

A purchase order is used when a buyer purchases inventory or supplies out right or on account. In invoice allows for immediate instant visibility of incoming stock and when delivery is due. A well-managed purchase order system should immediately inform on what has been ordered, shipped and received. “Creating POs in the system will allow tacking and prevent ordering more of an item than needed. This allows matching delivered goods against what was ordered and prevents wrong item or over delivery. Suppliers use PO’s in fulfilling orders and also in payment processing. Online invoicing software” (Johnson, & Flynn, 2014) quickly sends purchase orders and communicates through templates with vendors online. Invoices track earnings, shipping, receiving, and expenses. They give an understanding of inventory management and calculate profits through the sale of products. Properly used, invoices document business transactions, and ensure a strong understanding of orders completed, shipped, received, and billed out.

Bill of Lading

A bill of lading includes shipping information such as, type of goods within the shipment. It states the number of units shipped, the destination address for the load and a billing address. It includes the carriers name and will identify any type of hazardous material and specific shipping instructions such as temperature requirements, etc. The BOL is a transport document and is signed at points throughout the delivery process. The BOL is signed by the seller or representative of the shipper. Upon delivering the BOL will be signed by the receiver or representative of the consignee. The BOL protects the seller, the shipper, carrier, and the recipient and confirms the shipment is or was successfully delivered. It can also note if there was an issue with the shipment received such as damage in transit, missing product, arrive past deadline, etc. and where the problem occurred. The BOL can serve as proof for a claim filed for compensation related to the goods (Johnson, & Flynn, 2014).

Purchase Order Acknowledgment

Once a purchase order has been processed through a specific supplier, an order

acknowledgment is required from the supplier acknowledging our order and is required

to sign and date the document and send back if they agree with the order. This can be sent

through email, fax, or EDI. It is the buyer’s responsibility that they follow up with the

supplier if they don’t receive the order acknowledgement within 5 business days. (Sap

Purchase Order Acknowledgement", 2011-2018).

Delivery Note

The purpose of a Delivery Note is to acknowledge the receipt of a product by the buyer. A delivery note will accompany a shipment and be countersigned by the receiver upon receipt. Exchanging the product for a signature is usually the responsibility of the transportation company as the signature is acknowledgment buy the receiver that they have physically received the product from the transportation company, releasing them of responsibility for the product. A Delivery Note's signature acknowledges the receipt of the product but may not always acknowledge quantity nor quality of the product. Different receiving procedure may not allow for an extensive count or quality check upon receipt, allowing this to be done after receipt but within a certain time period. Delivery Notes are different from Bills of Ladings in whereas Delivery Notes can be broken up, having more than one Delivery Note under one Bill of Lading if the original shipment is going to more than one receiver ("Logistics Glossary", N.D.).

A Consignment Note is created when the product or shipment is being transferred from the shipper to the carrier, usually when being loaded for transportation. It is acknowledgment of transfer responsibility for the shipment therefor cannot be created and signed until physical transfer of the shipment is accomplished. It created by the seller and then sent and received by the transportation company ("Logistics Glossary", N.D.).

Consignment Note

A Consignment Note is a document signed by the carrier acknowledging receipt of a product for transportation. It is proof of receipt by the carrier of the product for delivery. This document is directly tied to the carrier's responsibility of a shipment, signed by the carrier when loading a shipment, acknowledging receipt and condition of the shipment then countersigned by the receiver taking possession of the shipment, noting obvious damages or shortages upon receipt of the shipment ("Base Logistics", 2014).

A Consignment Note is created when the product or shipment is being transferred from the shipper to the carrier, usually when being loaded for transportation. It is acknowledgment of transfer responsibility for the shipment therefor cannot be created and signed until physical transfer of the shipment is accomplished. It is created by the seller/shipper and then sent and received by the transportation company ("Base Logistics", 2014).

Goods Received Note

To acknowledge to the supplier that their material has arrived, and the customer has taken ownership of the material. It is created upon physical receipt and ownership of the material by the customer. It is created customers and customer receiving and logistics and then a receipt is sent to the supplier ("Upcounsil", 2018).

Scorecard

This document is a strategic planning and management system which takes into account non-financial aspects of corporate performance, such as customer satisfaction and processes to create a complete picture of how the company is likely to perform in the future. It is created after all purchases have taken place within a certain period of time by management is entered into an electronic system for all upper management to review ("Balanced Scorecard Institute", 2017).

References

Alford, K. (2017). Proofs of Delivery and Bills of Lading. Retrieved from https://www.ncscredit.com/education-center/blog/proofs-of-delivery-and-bills-of-lading/

Balanced Scorecard Institute (2017). Retrieved from https://www.balancedscorecard.org/BSC-Basics/About-the-Balanced-Scorecard

Base Logistics (2014). Retrieved from https://baselogistics.com/en/2014/08/04/consignment-note-as-proof/

Chron (2018). Retrieved from https://smallbusiness.chron.com/definition-balanced-scorecard-4838.html

Investopedia. (2018). Bill of Lading. Retrieved from https://www.investopedia.com/terms/b/billoflading.asp

Johnson, P.F. & Flynn, A. (2014). Purchasing and Supply Management (15th ed.). New York, NY: McGraw-Hill.

Logistics Glossary (N.D.). Retrieved from https://www.logisticsglossary.com/term/delivery-note/

SAP Purchase Order Acknowledgement (2011-2018). Retrieved from

http://www.erproof.com

Supplier Quotation (2017). Retrieved from https://erpnext.org/docs/user/manual/en/buying/supplier-quotation

Upcounsil (2018). Retrieved from http://ambituminnovations.co.uk/ambitum-innovations-review-keeping-speed-advances-technology/