CHAPTER 5 - PURCHASING AND RECEIVING CONTROL


What is purchasing?
-          PURCHASING- the process of getting the right product into a facility at the right time and in a form that meets pre-established standards for quality, quantity and price

Purchase Specifications?
•      A food service specification generally consists of following information:
1)      Product name or specification number
2)      Pricing unit
3)      Standard or grade
4)      Weight range/ size
5)      Processing and/or packaging
6)      Container size
7)      Intended use
8)      Other information such as product yield

Maximum and minimum inventory system?
•      Inventory – A detailed and complete list of goods in stock
•      This amount depends on the usage and time required for ordering and delivery.
•      If canned fruits and vegetables, for example, are purchased every three months through formal bidding procedure, the time lapse would be longer than for fresh produce that is ordered daily or weekly through informal buying.
•      Economic order quantity (EOQ) is the order quantity that minimizes the total holding costs and ordering costs
•      Terminology:
•      Minimum stock -  Amount of stock required to support testing operations until additional supplies are received
•      Lead time – Time between placing an order and receiving it
•      Maximum usage – number of test devices used in a given time period

Formula
•      Reorder level = Maximum usage x maximum lead time
•      Minimum stock level = Re order level  - (Average usage x Average lead time
•      Maximum stock = Re order level – (Min usage x min lead time) + EOQ

Purchase order / purchase record?
•      PURCHASE ORDER
•      Definition: A written sales contract between buyer and seller detailing the exact products to be ordered from a supplier. It will specify payment terms, delivery dates, item identification, quantities, shipping terms and all other obligations and conditions.

Maintain proper inventory records
Stock Card
-          Simple, heavyweight cards
-          Kept for each item in stock
 Stock Book or Computer Record
-          Contains listing of all items in the laboratory
-          Update monthly after physical count ( count one by one)
-          Use information from stock cards

The receiving process?
·         RECEIVING – point of which foodservice operations inspect the products and take legal ownership and physical possession of the items ordered.
·         PURPOSE OF RECEIVING – Ensure that the food and supplies delivered match established quality and quantity specifications.
·         1. Inspect the delivery and check against purchase order
·         2. Inspect delivery against invoice (a list of goods)
·         3.Accept order only if all quantities and quality specifications are met
·         4.Complete receiving records
·         5.Immediately transfer goods to appropriate storage

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