Purchase of Stationery | Policy | Methods | Advantages | Disadvantages
Table of Contents
Purchase of Stationery
Generally, the office manager is responsible to buy the stationery. He has to consider utility, price, quality, quantity, and storage facility before placing an order. The principles of purchase of office stationery are listed below:
- Purchasing at the right time.
- Purchasing of the right quantity.
- Purchasing at the right place.
- Purchasing of the right quality.
- Purchasing at the right price.
Policy of Stationery purchase
The purchase of office stationery is based on the purchasing policy of the concerned organization. Any one of the following policy can be followed by the organization.
1. Economic order quantity has to be fixed and purchased for easy handling and storing.
2. Quantity discount, cash discount and other discount are available from bulk purchase. There fore, bulk purchase has to be made,
3. Quantity of stationery purchased depends upon the usage of the respective stationery. The specified stationery is purchased more if the respective stationery is used in large quantity and vise versa.
4. The financial soundness of the organization influences the purchase of stationery.
5. The possible utility of the stationery should also be considered.
Stationery purchase methods
The office manager has to purchase the stationery if the business office is very small. In case of large business organization, a separate department is created to buy all the stationary items. Hence, the department’s manager must have a good knowledge of purchasing of quality stationery in an economical way. The purchased stationery can be stored and reserved based on consumption. Generally, anyone of the followings types of purchase followed by the large business office.
1. Tender System
Under this system, sealed tenders are invited from suppliers of stationery. The tender form contains the information like quality, size, number, price, offer, after sales service, discount etc. The suppliers have to send their tenders in a sealed envelope to the business office. All the received tenders will be opened on specified date and time and allot supplies to supplier who has quoted the lowest price. If two suppliers quote same price, negotiations take place for finalizing the supply. Tender system ensures the supplies throughout the year continuously and reduces the time of purchase.
Advantages of Tender System
1. Whenever the stock of stationery is exhausted, an order is placed and received the stationery immediately.
2. There is no need of negotiation, discussion, and haggling.
3. If the prices are increased during the contract period, the business unit will have to pay only contract price i.e. tender price.
4. The lowest price is accepted under tender system. Hence, money is saved.
5. An order is placed on consumption basis. It avoids unnecessary lock up of the funds.
6. Periodical placement of an order ensures in getting fresh items.
7. The supplier supplies standard stationery items. The reason is that supply of bad quality will affect long term relationship.
8. There is no favor to any supplier. Hence, fraudulent practices are minimized.
Disadvantages of Tender System
1. If the prices are going down in the market, the agreed prices should be paid by the office.
2. The best quality of stationery items may not be available at all times. The reason is that lowest price means the lowest standard.
This method of practice is followed by much business office in all purchases. The business office invited as many quotations from the suppliers. Quotation refers to the price list given by different suppliers for whom the office stationery requirements are sent. The supplier who quote lowest price receives the order from the office.
The business office has to prepare comparative price statement out of the quotations given by the supplier and then place the order. Suppliers will be informed of the quality and average quantity of items to be purchased. Sometimes, the suppliers will be asked to give sample items of stationery for clear understanding.
Order need not be placed with one supplier but with several suppliers according to their lowest price quotation. Therefore, the suppliers can render best possible service unless they might loose the order in next time.
This system creates a kind of healthy competition among the suppliers throughout the year and perhaps for years to come. The advantages and disadvantages of quotation are very similar to tender system.
3. Fixed Supplier
The business office can avail the service with regard to purchase of stationery from only one supplier. The reason is that there may be a honesty on the part of supplier.
Supplier shall expect placement or orders on the basis that supplier supplies quality articles and will charge affordable price. In the business world, blind belief leads to charging of higher rate than rate prevailing in the market. Hence, the business office can make periodical check up of market prices to measure the honesty of the supplier.
Sometimes, the supplier may charge the prices lower than the market prices in order to attract the customers. This type of purchase is followed only for urgent needs and for a small amount.
The fixed supplier is not suitable or advisable if the amount is heavy and in ordinary occasions.
Advantages of Fixed Supplier
1. There is an intimacy between the business office and the supplier. A goodwill is created through intimation.
2. The business office gets priority in times of scarcity of stationery.
3. An order is received by the supplier certainly. Hence, the supplier charges reasonable prices for standard items in order to retain the customer i.e. the business office.
Disadvantages of Fixed Supplier
1. Substandard stationery items may be supplied in times if the same supplier is selected continuously.
2. It is very difficult to place the order and receive the quality and required items from other supplier if the fixed supplier fails to supply the required items.
3. The auditor may object if the heavy order is placed with the fixed supplier.
4. There is unnecessary criticism of corrupt on the part of purchasing office even though he may be quite honest and innocent.
4. Traveling Salesman
Manufacturers and wholesalers often send their representatives [salespersons] with samples to receive orders. Experience has shown that the trust worthy of representatives is questionable. They show quality samples while receiving order but the supplied items are not resembles with samples. Moreover, comparison of the prices quoted by the salespersons is not possible.
Generally, the prices quoted by the salespersons are higher than the market price. The reason is that the business office is not in a position to compare the prices. Unless the stationery is urgently required, no order can be placed with the traveling salesmen.
However, quality items and patent items like ink, pencil, ribbons, carbon papers, and the like may be purchased from the traveling salesmen. The usage and significance of the new stationery items can be understood from the explanation of salespersons.
Today many varieties of cost saving and time saving office stationery items are available in the market. Therefore, as per the needs of the office, new brands of quality can be purchased.