1. A need is recognized. Someone recognizes that the organization has a need that can be solved by purchasing a good or service. In this case, the home building company has a need in lumber for constructing.
2. General need dercription and product specification: Group of Engineer, accountant, Manager brought together to help make the buying decision, work to put some parameters around what needs to be purchased. In this case, they describe what kind of lumber they believe is needed, the features it should have, how much of it is needed, and so on. 3. Potential suppliers are searched for. At this stage, the people in home building company involved in the buying process seek out information about the products they are looking for and the vendors that can supply them. They look online first to find sellers and products, then telephone or e-mail the suppliers with whom they have relationships. Purchasing agents often play a key role when it comes to deciding which vendors are the most qualified. Are they reliable and financially stable? Will they be around in the future?
4. Qualified suppliers are asked to complete responses to requests for proposal (RFPs).Purchasing agent of home building company will sent to company’s sales organization that meet a requirement an invitation to submit a bid to supply the good or service. An RFP outlines what the seller is able to offer in terms of its product—its quality, price, financing, delivery, after-sales service, whether it can be customized or returned.
5. The proposals are evaluated and supplier(s) selected:the decision of choosing seller base on these criteria:
- The price
- The quality
- The valaibility of product.
- The Reliability of supply
Weyeehaeuser company’s chosen to supply lumber for home building company
6. An order routine is established. This is the stage in which the actual order is...