The importance of sustainable purchasing and supply Essay

The importance of sustainable purchasing and supply - Essay Example It can also be stated that purchasing and supply operations on a long term basis enable the organisations to gain greater stability and generate substantial profits. The paper intends to discuss the perception of procurement and the benefits of effective purchasing and supply in a business. Various aspects like the significance of the association between a good purchaser and a supplier, the notion of competitive advantage and how the selection of a reliable supplier is such an important issue in generating competitive advantage will also be discussed in the paper. 1. Concept of Procurement Procurement is the process of obtaining new products or services. It is often regarded as a strategic role for different organisations belonging to both public along with private sectors. It has been viewed to be a dynamic process that covers several significant activities relating to supply chain that comprise generating contracts, purchasing and performing logistical functions (Bower, 2003). It h as been apparently observed that the procurement process includes certain fundamental inputs in the form of physical structure like raw materials that is required for preserving the product standards and maintain greater product reliability supporting the organisations to accomplish superior competitive position. The process of procurement also consists certain other wide ranging aspects that include storing, receiving and inspecting among others. The process also signifies the requisition as well as the acquisition of materials. The perception of procurement generates a logical meaning that indicates to supply the right materials to the correct person and at a precise time. It can also be viewed that an effective process of purchasing or procurement assists an organisation in decreasing the costs and maintaining the quality of the products along with mitigating the risks linked with supply chain management. Moreover, effectual procurement would also enable the organisations to gene rate greater productivity, broader availability of raw materials and mitigate the risks relating to inventory levels of products (Altekar, 2005). In this similar concern, the aspect of sustainable procurement can be considered as a significant aspect as a form of business activity in this modern day context. It is regarded as a process through which considerable savings can be done with respect to decrease in the waste materials, increase in the efficiency of the business along with gaining greater competitiveness. Various oil companies have generally adopted sustainable procurement programs such as investing much upon transportation facilities and networking with the intention of competing with their major market competitors. It also develops the economy by offering employment facilities and sourcing organisation (Mahadevan, 2010). 2. Benefits of Effective Purchasing and Supply Effective purchasing and supply can be principally determined as one of the imperative elements in the pr ocess of supply chain mana