NetSource Technology, Inc. is an independent stocking distributor known worldwide for providing electronic components and global procurement services to contract manufacturers and original equipment manufacturers (OEMs). With more than two decades of industry experience, we have amassed extensive product knowledge and a worldwide network of trusted suppliers that allow us to source and stock both current and obsolete parts. Our on-site inventory houses brand-new components from reputable manufacturers, including end-of-life (EOL) products, hard-to-find parts, and highly allocated pieces with long lead times. Regardless of what electronic component our customers need, we can help them procure it.
What Is Procurement?
The term “procurement” refers to the supply chain process that allows industry professionals to analyze their spend and adjust it to align with their company’s overall objectives and goals. Depending on the needs of the business, there are two subcategories of procurement processes employed:
- Direct procurement is the process by which a company obtains parts, materials, and services for the production of goods and services. It refers specifically to items and services purchased for inclusion in products and services offered by the company.
- Indirect procurement refers to the purchase of products and services needed to support business operation and functionality indirectly, such as office supplies, cleaning services and materials, and maintenance of office space and equipment.
Three “P”s of Procurement
Quality procurement services require an organized and systematic approach, which is why, at NetSource, we consider the following:
- Process. Ensuring swift and efficient sourcing necessitates the implementation of a set procedure for each step of the procurement process, including order review and confirmation, submission, receiving, and timely reimbursement for goods and services.
- People. All stakeholders should be engaged in the procurement process and aware of their role, to ensure that each step of the procedure is completed consistently and accurately.
- Paper. Each step of the procurement process should be documented and stored for easy reference and auditing. This helps to ensure accountability and reduce liability for all parties involved in the process.
10 Steps of the Procurement Process
Our procurement process includes the following steps:
- Recognizing the needs of the company who is requesting the product to ensure they are getting the products and services they require
- Obtaining a detailed purchase requisition
- Reviewing the request for accuracy and communicating with the client to correct any errors
- Confirming budget approval from the client for the service or product requested
- If requested, completing a detailed quotation request
- Negotiating terms, reviewing, and signing the contract for goods and services procurement
- Delivering the goods and/or services to the client as per the contract
- Comparing the invoice, purchase order, and receiving report for Three-Way-Matching to ensure accuracy and accountability
- Receiving approval on invoices and payment
- Storing all documentation pertaining to the particular procurement request for future reference and audit purposes
Procurement vs. Other Processes
Although the terms are often used interchangeably, procurement differs from acquisition, purchasing, sourcing, and supply chain in a number of ways:
- Procurement consists of the identification, selection, and acquisition of particular materials, products, or services from third-party providers on behalf of a business. The procurement process includes the development of contracts and relationships with third-party providers, establishment and enforcement of quality standards, and a detailed understanding of particular customer needs to better source and expedite the delivery of requested products and services.
- Acquisition is a more complex process that entails the entire development of a product or service, from the initial product design to the procurement and manufacture of parts to product assembly, marketing, and shipping. Procurement could be considered part of the acquisition process.
- Purchasing is simply the exchange of money for products and services and can be considered a part of the overall procurement process. Purchasing does not involve the same level of contract and relationship management as procurement.
- Sourcing is also a part of the broader procurement process; it is the process by which the procuring entity vets and negotiates contracts with the suppliers of the required goods and services. It may also include ongoing relationship management and product review to ensure that customers are receiving the best quality goods and services at reasonable prices.
- The supply chain is the entire infrastructure of entities involved in the movement of a product, from raw material and parts procurement to manufacturing, distribution, warehousing, marketing, and sales. The supply chain consists of each individual involved in the process, and procurement is considered one part of that whole.
Procurement Solutions From NetSource Technology
At NetSource Technology, we offer seamless procurement solutions, including sourcing to support services, access to a comprehensive product portal that includes millions of products from trusted suppliers across the world, and flexible payment options. By partnering with us for their procurement needs, customers benefit from our:
- Years of industry experience and extensive product knowledge
- Worldwide network of suppliers
- Large on-site inventory
- Zero-tolerance, anti-counterfeit policy
- ISO 9001:2015 certification
- Quick response times
Customers who employ our procurement services come from a diverse set of industries, including aerospace, automotive, Internet of Things (IoT), medical, mobile devices, and telecommunications.
For more information on our procurement services, visit our company page. Request a quote for pricing for your next project.