Under what condition should a firm practice " Forward buying" methods of buying ?

When demonstrating this policy success of the company

When you get a supplier provides lower costs

When there is a competitive advantage in that

Be better for the company to follow a consistent policy

Forward Buying is more than a future commitment as it involves physical act of buying which may or may not include staggered deliveries at future dates. This is done keeping in view various factors such as:

• Demand Projections
• Price/Inflationary Trends
• Storage Requirements if deliveries are to be made at the time of buying
• Cash Flows 
• Anticipated changes in Fiscal/Tax structure
• Volume Discounts
• Ordering Costs
• Future Availability of the product
• etc etc

Forward Buying : Forward Buying as the name suggests is the system under which buying is done with longer term in perspective.

It is not meant for meeting the present consumption requirement. It is rather a commitment on part of both the buyer and the seller , normally for a period of one year. 

Depending upon the availability of the item, the financial policies, the economic order quantity, the quantitative discounts, and the staggered delivery, the future commitment is decided.

A few organisations do “hedge”, particularly in the commodity market by selling or buying contracts.

Forward buying helps a firm in booking capacity of a supplier and thus often results into a safeguard against a competitor acquiring his capacity. It is usually done for Raw materials but is not limited to it. Now a days , with competition becoming globalised such an arrangement is a win-win situation for both , the buyer and the supplier.

It is a situation when sales channels (wholesalers, distributors, retailers...) buy huge quantities of a product in the promotion period for a low price and stock it until after the promotion period. 

I think, when they have big warehouses, great deals from suppliers, great channels to sell, etc...

Forward buying in other words is buying for future, when company expects a price rise or increase in demand, they opts for forward buying.

There are many factors which encourages forward buying.

• Inventory already on hand
• Available fund.
• Payment terms
• Delivery lead time
• Transportation and handling cost
• sales forecast.

when they reach by doing that the maximum productivity level.

and of course the rest of answers are good

When there is enough equity.

agree with all expert answer

Forward Buying as the name suggests is the system under which buying is done with longer term in perspective.It is not meant for meeting the present consumption requirement. It is rather a commitment on part of both the buyer and the seller , normally for a period of one year. Depending upon the availability of the item, the financial policies, the economic order quantity, the quantitative discounts, and the

staggered delivery, the future commitment is decided.

 A practice used by both wholesalers and retailers involving the stocking up of specific products that are offered by a particular product manufacturer at a lower price. This item may then be resold to consumer purchasers after the promotional period of the marketer is over.