11:709:364 Lecture Notes - Lecture 4: Purchase Order
19 Feb 2020
School
Department
Course
Professor
Document Summary
Steps of the purchasing process: identifying the need, planning the purchase, making the purchase. What drives the need to purchase goods: 1) the menu (proper ingredients and quantity, 2) the type of establishment. How are purchase needs determined/calculated: from recipes and estimated service, compare with inventory, consider what additional amounts are needed, which will need to be purchased more often perishables or non-perishables. Consider frequency of deliveries and lead time: how often and when are deliveries made, time between ordering and acquisition, time between acquisition and use. Often done electronically or via the phone. Invoice: what the supplier is providing the buyer; the receipt (completed by the seller: a legal document, compare with po when items are delivered. Reorder point (fixed order quantity inventory): lowest stock level that safely can be maintained to avoid emergency purchasing: reorder point = (average daily use x lead time) + safety stock. Example: your school food service operation uses 100 hamburger buns every day.
