From the course: Supply Chain and Operations Careers: Certification Tips and Tricks (2019)

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Basic procurement terminology

Basic procurement terminology

From the course: Supply Chain and Operations Careers: Certification Tips and Tricks (2019)

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Basic procurement terminology

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- Procurement is about buying the things you need to run a business. Of course, that means buying the right stuff in the right quantity and getting the best deal. But that can be a lot more complicated than many people realize. In this video, we'll look at how procurement organizations are structured and some of the unique terms that procurement professionals use. The head of the procurement organization is the chief purchasing officer. Under the CPO, there could be directors and managers who specialize in purchasing different kinds of things. For example, many companies make a separation between the things that they buy to put into a product and the things that they need to run the business. The things that go into a product are called direct materials. For example, if you're a car manufacturer, the metal glass and plastic you buy are all direct materials. Then, there all of the other things that you need to run a…

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