Purchasing manager

Purchasing managers are in charge of buying goods, equipment and services for their company, and try to ensure the most competitive prices. They are also responsible for negotiating contracts, reviewing the quality of products and analyzing suppliers , and the use and resale of goods and services.

The following job titles also refer to purchasing manager:

purchasing coordinator
purchasing officer
purchasing managers
purchasing administrator
buyer
buying manager
procurement manager

Bachelor’s degree is generally required to work as purchasing manager. However, this requirement may differ in some countries.

ISCO skill level is defined as a function of the complexity and range of tasks and duties to be performed in an occupation. It is measured on a scale from 1 to 4, with 1 the lowest level and 4 the highest, by considering:

• the nature of the work performed in an occupation in relation to the characteristic tasks and duties
• the level of formal education required for competent performance of the tasks and duties involved and
• the amount of informal on-the-job training and/or previous experience in a related occupation required for competent performance of these tasks and duties.

Purchasing manager is a Skill level 4 occupation.

These occupations, although different, require a lot of knowledge and skills similar to purchasing manager.

forecast manager
resource manager
supply chain manager
ICT vendor relationship manager
project manager

These occupations require some skills and knowledge of purchasing manager. They also require other skills and knowledge, but at a higher ISCO skill level, meaning these occupations are accessible from a position of purchasing manager with a significant experience and/or extensive training.

This knowledge should be acquired through learning to fulfill the role of purchasing manager.

Corporate social responsibility: The handling or managing of business processes in a responsible and ethical manner considering the economic responsibility towards shareholders as equally important as the responsibility towards environmental and social stakeholders.
Quality standards: The national and international requirements, specifications and guidelines to ensure that products, services and processes are of good quality and fit for purpose.
Supply chain principles: Characteristics, operations and resources involved in moving a product or service from supplier to the customer.
Supply chain management: The flow of goods in the supply chain, movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.
Supplier management: The methods and techniques to ensure that external services and configuration items, which are necessary for the service delivery, are available as requested and as agreed at the service level.

These skills are necessary for the role of purchasing manager.

Identify suppliers: Determine potential suppliers for further negotiation. Take into consideration aspects such as product quality, sustainability, local sourcing, seasonality and coverage of the area. Evaluate the likelihood of obtaining beneficial contracts and agreements with them.
Study sales levels of products: Collect and analyse sales levels of products and services in order to use this information for determining the quantities to be produced in the following batches, customer feedback, price trends, and the efficiency of sales methods.
Order supplies: Command products from relevant suppliers to get convenient and profitable products to purchase.
Manage budgets: Plan, monitor and report on the budget.
Maintain relationship with customers: Build a lasting and meaningful relationship with customers in order to ensure satisfaction and fidelity by providing accurate and friendly advice and support, by delivering quality products and services and by supplying after-sales information and service.
Strive for company growth: Develop strategies and plans aiming at achieving a sustained company growth, be the company self-owned or somebody else’s. Strive with actions to increase revenues and positive cash flows.
Maintain relationship with suppliers: Build a lasting and meaningful relationship with suppliers and service providers in order to establish a positive, profitable and enduring collaboration, co-operation and contract negotiation.
Analyse logistic changes: Assess the financial impact of possible logistics changes such as shipping modes, product mixes or volumes, carriers and means of product transportation.
Coordinate purchasing activities: Coordinate and manage procurement and renting processes including purchasing, renting, planning, tracking and reporting in a cost efficient way on an organisational level.
Negotiate sales contracts: Come to an agreement between commercial partners with a focus on terms and conditions, specifications, delivery time, price etc.
Manage contracts: Negotiate the terms, conditions, costs and other specifications of a contract while making sure they comply with legal requirements and are legally enforceable. Oversee the execution of the contract, agree on and document any changes.
Analyse supply chain strategies: Examine an organisation’s planning details of production, their expected output units, quality, quantity, cost, time available and labour requirements. Provide suggestions in order to improve products, service quality and reduce costs.
Assess supplier risks: Evaluate supplier performance in order to assess which suppliers do or may not perform adequately, stick to the agreed contracts, meet the standard requirements and desired quality at all times or who may pose future risks.
Manage inventory: Control product inventory in balance of availability and storage costs.
Analyse supply chain trends: Analyse and make predictions about trends and evolutions in supply chain operations in relation to technology, efficiency systems, types of products shipped, and logistical requirements for shipments, in order to remain at the forefront of supply chain methodologies.
Estimate costs of required supplies: Try to value the amounts and costs of required supplies such as of food items and ingredients.
Issue sales invoices: Prepare the invoice of goods sold or services provided, containing individual prices, the total charge, and the terms. Complete order processing for orders received via telephone, fax and internet and calculate the customer’s final bill.
Liaise with managers: Liaise with managers of other departments ensuring effective service and communication, i.e. sales, planning, purchasing, trading, distribution and technical.
Follow company standards: Lead and manage according to the organisation’s code of conduct.
Negotiate buying conditions: Negotiate terms such as price, quantity, quality, and delivery terms with vendors and suppliers in order to ensure the most beneficial buying conditions.

This knowledge is sometimes, but not always, required for the role of purchasing manager. However, mastering this knowledge allows you to have more opportunities for career development.

Pricing strategies: The techniques, theories, and commonly accepted strategies regarding pricing of goods. The relation between pricing strategies and outcomes in the market such as profitability maximisation, deterrence of newcomers, or increase of market share.
Risk management: The process of identifying, assessing, and prioritising of all types of risks and where they could come from, such as natural causes, legal changes, or uncertainty in any given context, and the methods on dealing with risks effectively.
Market pricing: Price volatility according to market and price elasticity, and the factors which influence pricing trends and changes in the market in the long and short term.

These skills and competences are sometimes, but not always, required for the role of purchasing manager. However, mastering these skills and competences allows you to have more opportunities for career development.

Manage supplies: Monitor and control the flow of supplies that includes the purchase, storage and movement of the required quality of raw materials, and also work-in-progress inventory. Manage supply chain activities and synchronise supply with demand of production and customer.
Track price trends: Monitor the direction and momentum of the product prices on a long-term basis, identify and predict the movement of prices as well as identify the recurring trends.
Manage staff: Manage employees and subordinates, working in a team or individually, to maximise their performance and contribution. Schedule their work and activities, give instructions, motivate and direct the workers to meet the company objectives. Monitor and measure how an employee undertakes their responsibilities and how well these activities are executed. Identify areas for improvement and make suggestions to achieve this. Lead a group of people to help them achieve goals and maintain an effective working relationship among staff.
Monitor stock level: Evaluate how much stock is used and determine what should be ordered.
Calculate purchasing levels of raw materials: Estimate the adequate quantities of raw materials to be purchased and required to meet the production objectives based on the prospects and forecasts.
Recruit employees: Hire new employees by scoping the job role, advertising, performing interviews and selecting staff in line with company policy and legislation.
Attend trade fairs: Attend exhibitions organised to enable companies in a specific sector to demonstrate their latest products and services, study the activities of their competitors, and observe recent market trends.
Promote sustainable management: Contribute to planning and policy development for sustainable management, including input in environmental impact assessments.
Ensure equipment availability: Ensure that the necessary equipment is provided, ready and available for use before start of procedures.
Analyse consumer buying trends: Analyse buying habits or currently prevalent customer behaviour.
Maintain contract administration: Keep contracts up to date and organise them according to a classification system for future consultation.
Manage rented goods returns: Organise the return of rented goods to the distributor.
Carry out statistical forecasts: Undertake a systematic statistical examination of data representing past observed behaviour of the system to be forecast, including observations of useful predictors outside the system.
Train employees: Lead and guide employees through a process in which they are taught the necessary skills for the perspective job. Organise activities aimed at introducing the work and systems or improving the performance of individuals and groups in organisational settings.

1324 – Supply, distribution and related managers

 

 

---

 

 

References

1. Purchasing manager – ESCO