THE ROLE OF PURCHASING IN PRODUCTION

CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

During the past few year, purchasing and supply function as a discipline has changed considerably in many companies. This is reflected in the increased attention this function is receiving from manager and practioners. Considering the amount of money generally involved in the preparation and execution of purchasing and supply function decision, this is not so stranger. An effectively and efficiently operating purchasing and supply function can make an important contribution to the company result. However, there is more. As a result of implementation of improvement programmes in engineering, manufacturing and logistics management, many companies feel the need for improved relationship with suppliers. These relationship necessary should result in lead time reduction in new product development and just-in-time delivering zero effect on components. According to Uzor (2004) the function of purchasing is to insure that supply of raw material, product equipment fuel and power, consumerable and services for use resale by organization in the right quantities, right quality, right place right time and at the right economist cost for increase in profit. The role of purchasing also cover areas like suppliers development value analysis and harmonious relationship with other functional units like production design engineering, inspection, maintenances, finance, marketing, personnel and transport. Purchasing users some managerial tool like to achieve the objective of its function of uninterrupted or a constant flow of materials to meet the need of the user department. The research therefore found that there is an important area to explore which to find what role purchasing has to play to justify it as a management function and its contribution to profit for the organization.