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Purchase is part of the Procurment t process materials.Purchase is to the purchase, follow-up article , supplied and tested and stored.But the Procurment will be :
Materila Submittal
Quatation comparison Statment
Supply Agreement
Subcontract agreement
Budjet justification
Material Cost Control to Cmplete and .....................others
The terms “Purchasing” and “Procurement” are often used incorrectly interchangeably.
Procurement is the function that describes the activities and processes to acquire goods and services. Importantly, and distinct from “purchasing”, procurement involves the activities of establishing fundamental requirements, sourcing activities such as market research and vendor evaluation and negotiation of contracts. It can also include the purchasing activities required to order and receive goods.
Purchasing refers to the process of ordering and receiving goods and services. It is a subset of the wider procurement process. Generally, purchasing refers to the process involved in ordering goods such as request, approval, creation of a purchase order record and the receipting of goods. It can be best summarized with the term P2P cycle which stands for Purchase to Pay.
Agreed with all above, inshort purchasing is an old term (which is not restricted to purchasing only but involve the detail process). While Procurement is the new term, used for the same dept who dealt in inviting quotations/bids from various vendors/suppliers, short list them, ensure about insurance and post sell service then place the order via LPO and ensure that all the terms of purchasing are satisfied prior making the final payment.
Just an example of old times Accounts dept and now it is Financial Control.
Procurement will only responsible for Bid evaluation Tender process and cost control, Project management, Monitor the purchasing activities, communication and administration between one department to other department. He/She will responsible for the bid opening and decision maker when teotiatndering. Purchasing Dept will work under the controlling by Procurement Manager. Etc Purchasing department will take care of buying materials, cost control, find good vendor/supplier and negotiate the price, follow the purchasing procedure and regulation, work in team, communication with Accounting/Finance Dept and Procurement to make sure the prices are correct (PC) - Price Comporation. etc.
"Procurement deals with the sourcing activities, negotiation and strategic selection of goods and services that are usually of importance to an organization. Purchasing is the process of how goods and services are ordered"
Purchasing is a simple activity of buying a product or service for the company, however Procurement is more strategic in nature which means going through the whole process of getting few quotations, comparison and approvals, placing the orders and making sure the material is recieved on time and correct quantity etc.
The Title Purchasing & Procurement comes under same hierarchy, only thing is that Purchasing acts immediate action upon requirement.
Whereas Procurement needs to follow the procedure like contacting min 3 Vendors, getting offers, Price Negotiation, Quality Check, Best Delivery Period, Best Payment Terms in terms of Credit.