The Procurement Process and Supply Chains

The procurement process is the process of acquiring goods or services from an external source. It is a critical part of any business, and it can have a significant impact on the bottom line. In this chapter, we will discuss the procurement process and supply chains in detail.

1. The Procurement Process

The procurement process can be divided into a number of steps, including:

  • Need recognition: The first step in the procurement process is to recognize that there is a need for a good or service.
  • Sourcing: The next step is to source potential suppliers. This can be done through a variety of methods, such as online research, trade shows, and referrals.
  • Purchasing: Once a supplier has been selected, the next step is to purchase the good or service. This can be done through a variety of methods, such as a purchase order or a contract.
  • Payment: The final step in the procurement process is to pay for the good or service.

2. Supply Chains

A supply chain is the network of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. Supply chains can be complex, and they can involve a number of different organizations, such as manufacturers, wholesalers, and retailers.

There are two main types of supply chains:

  • Direct supply chains: In a direct supply chain, the product or service moves directly from the manufacturer to the customer.

Procurement and Supply Chains in Nepal

The procurement process and supply chains in Nepal are often complex and inefficient. This is due to a number of factors, including a lack of infrastructure, a lack of skilled personnel, and a lack of a strong legal and regulatory framework.

Some of the specific challenges that businesses in Nepal face in managing their supply chains include:

  • Poor infrastructure: The infrastructure in Nepal is still developing, which can make it difficult to transport goods and services around the country.
  • Lack of skilled personnel: There is a lack of skilled personnel in Nepal who can manage supply chains effectively.
  • Lack of a strong legal and regulatory framework: The legal and regulatory framework for supply chains in Nepal is still developing.
  • High transportation costs: The cost of transportation in Nepal is high, which can make it difficult for businesses to compete with businesses in other countries.

Despite these challenges, there are also a number of opportunities for improvement in the procurement process and supply chains in Nepal. These opportunities include:

  • The increasing availability of affordable technology: The increasing availability of affordable technology, such as cloud computing and mobile devices, is making it easier for businesses in Nepal to automate their procurement process and to improve their supply chain management.
  • A government that is supportive of supply chain management: The government of Nepal is supportive of supply chain management and is working to create a more favorable environment for its growth.
  • A growing number of businesses that are investing in supply chain management: A growing number of businesses in Nepal are investing in supply chain management, which is helping to improve the efficiency and effectiveness of the country’s supply chains.