What Is a Procurement Cycle?

The procurement cycle refers to the entire cycle time when the purchaser decides to place an order and places the order-supplier confirmation-order processing-production planning-raw material procurement (sometimes)-quality inspection-shipping (sometimes third-party logistics). Simply put, it is the number of days between regular purchases.

purchasing cycle

Right!
The procurement cycle refers to the entire cycle time when the purchaser decides to place an order and places the order-supplier confirmation-order processing-production planning-raw material procurement (sometimes)-quality inspection-shipping (sometimes third-party logistics). Simply put, it is the number of days between regular purchases.
Chinese name
purchasing cycle
Definition
Regular number of days between purchases
Calculation method 1
Empirical quantitative method
Calculation method 2
Point of purchase
The purchase cycle is when the buyer decides to place an order and places an order-

Purchasing cycle empirical quantitative method

Purchase cycle = days in transit + average storage days + sales preparation days + motor insurance days
The average number of days of purchase in a certain business cycle = (the quantity of each purchase of the product × the number of days between each purchase) / the total amount of purchases during the period

Procurement cycle

That is, when the commodity inventory drops to a certain limit, the method of immediate purchase
When supply and sales are relatively stable: purchasing point = average daily sales amount × average purchase interval days
When supply and sales are unstable: purchase point = (average daily sales amount × average purchase interval days) ± safe storage. (Supply less than demand adds up, supply exceeds demand minus).

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