Procurement is series of steps in order to find and with the consent of authority to become agree with the terms of obtaining goods and services, of an external agency which is general known as bidding process.
A business which is large in size the procurement of their raw material is done through the different agencies, which offer different rates for the raw materials and then company makes the decision from which agency the procurement must be purchased.
When a company needs procurement it advertise that procurement to media like contracts in which contractors offer their bids for a particular process they come to know about that procurement through the advertisements in the print media and electronic media.
The authority of the business which gives order to obtain procurement from the external agency it must also understand the art to obtain products and services, as it follows a complete process in which the identification of the requirement must be recognized.
The company or the authority who is responsible for the procurement must recognize the need of the company and then make decision that either it should be obtained from the internal sources or from the external sources, internal sources can be the purchase department of the company and external sources are the different agencies who bid different rates for that particular procurement.
For a bid in a procurement a particular date is given to the contractors in advertisement in which it is also mentioned in the advertisement that the duration to complete that work is must be according to a specific time, the quality and quantity of the procurement is given according to the standards.
Before the procurement advertisement given to the agencies the rate and the best price for that product is investigated by the company in order to have a good idea.
When the different agencies submit their bids to the company now the company will make decision in way that must not favor to a particular agency it must be neutral, the authority will make the decision for a bid which offers reasonable prices neither the less nor the higher for the procurement.
The cheap rates offered by the agency is not an assurance for the quality of procurement, the quality of the procurement will be compromised which can lead the company to a big loss, the company that’s why accepts the offers of the person or agency who gives the fair and reasonable price.