What is a sample procurement policy?


Quick Answer

A sample procurement policy is an example or template of a company’s written procedures for obtaining goods, materials and services. Such samples provide guidance to companies that wish to establish a procurement policy or revise an existing one. An example of a Procurement Manual for a large company appears on HousingIssues.org and DevelopingIssues.org featuring a sample procurement policy for sustainable timber that can easily be adopted by any type of business.

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Full Answer

The failure to establish a company procurement policy can increase the cost of doing business to an unnecessarily high level, explains Entrepreneur.com. A good policy should answer questions relating to who has the authority to make purchases, the type of purchases they may make and any limits on that authority according to the Small Business Administration.

Some companies include a mission statement in its procurement policy. Kodak’s goal is to obtain the best value of its purchases and maintain the highest ethical standards, according to its corporate purchasing policy posted on Kodak.com. Kodak’s policy establishes the company’s Purchasing Department as the only corporate unit authorized to make purchases for the company and expressly forbids other departments or employees from making or entering into any agreements that commit the company to make purchases. It also outlines controls to ensure adherence to the policy, such as requiring Purchasing Department approval, the use of company drafted purchase orders and forms, and procedures to obtain purchase authorizations.

The procurement policies of some companies, such as IBM, include rules of conduct and standards of ethical behavior, as seen in its corporate procurement policy on IBM.com. IBM’s procurement policy sets forth rules regarding business meals and expenses, the use of reciprocal purchase arrangements and employee acceptance of gifts.

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