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It tends to be large organisations with multiple national offices and/or multinational offices which have a procurement department, normally in order to rationalise the use of suppliers across the different offices, and to be able to benefit from group discounts. They normally deal with all key purchasing decisions across the organisation, such as software and hardware suppliers, and contractors. Occasionally, they get involved in procuring external legal services for an organisation, in particular where large global firms are used across the organisation, but the legal department will usually want oversight of this at the very least, if not full control, in particular because you will generally have a better understanding of the likely costs involved and a better handle on day to day legal cost control.
The procurement department typically asks a series of questions when identifying suppliers, as follows:
what is the business requirement, based on the organisation’s strategy?
should the organisation look to itself produce the product/service, or outsource the supply?
can the organisation obtain everything it needs from one supplier, or will multiple suppliers be required?
how can the right suppliers be sourced, eg via consultants, recommendations, trade fairs?
Once identified, suppliers are normally invited to put in a bid for the work, using requests for proposals (RFPs), sometimes known as requests for infomation (RFIs) or requests
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