THE PURCHASING IN FOOD SERVICE MANAGEMENT

hii.. evening uollss..
so today, as usual, i wanna share with about what i've learned in Catering System subject.
and for today, we gonna go through chapter 6, which is PURCHASING, okay ?

EH ! before i forgot, today is 14th February isn't it ?
 i nak advice yang couple2 tu, TOKSAH lah celebrate VALENTINE DAY..
 and I bet all of u are Muslim kan ?

haaaa.. meh sini i nak sental2 sikit uols punya pemahaman bout' this valentine day.

Celebrating Valentine's Day means resembling or imitating the pagan Romans, then the Christian imitation of the Romans in something that was not part of their religion.

Because Valentine's Day goes back to Roman times, not Islamic times, this means that it is something which belongs exclusively to the Christians, not to Islam, and the Muslims have no share and no part in it. 
The most important thing that you ( muslim ) need to know is, the Prophet Nabi Muhammad said: "Whoever imitates a people is one of them." 

So, whoever yang follow the Cristian and celebrate the Valentine Day, theyolls tu lebih kurang je macam mereka tau.. astaghfirullahalazimm.. 

Renung2 kan dan selamat beramal ye ? ihiks :)

Eh eh ehhh.. dah macam kelas CTU plak u kata ya ?? hahaha

ok ok lets go to our Purchasing topic pulak ye .....

What is Purchasing ?

In easy language, purchasing is when you acquire ( something ) by paying for it, same goes to buy.

It is the process of getting the right goods, at right time, for the right quantity, quality and also at the reasonable price that meets the established standards.

This is the example for Purchasing Activities Flow.

The Market

- It is means a place where buyer and seller meets together in order to carry on transactions of goods and services.

- There are 5 types of market :

1. Marketing channel - a set of practices or activities necessary to transfer the ownership of goods, from the point of production to the point of consumption. It is the way products and services get to the end-user, the consumer; also known as a distribution channel.
2. Primary market - the basic source of food supply including growing regions and processing plants
3. Secondary market - the physical, functional unit of the marketing system, which the products are accepted from the primary markets and distributed to the buyer.
4. Local market - Clients and customers who will buy a product in the region or area in which it is produced include customers located within the region the product or service is produced or made available.
5. Broker - wholesaler who does not assume ownership of the goods, bring the buyer and seller together.

- Market have their own regulation by U.S. Food and Inspection Program.

• Interstate Commerce
• any commercial transactions or traffic that cross state boundaries or that involve more than one state. 
• for an instance, a company in Negeri Sembilan buys something from a company in Pahang.
• Intrastate Commerce
• The act of purchasers and sellers transacting business while keeping all transactions in a single state.
  
• for an example, a company in Kuala Lumpur buys something from a company in Kuala Lumpur  also.

U.S. Department of Agriculture (USDA)

- USDA's Food Safety and Inspection Service is responsible for ensuring that the nation's supply of       meat, poultry, and egg products is safe and properly labeled.

Stamps of inspection by USDA

Food and Drug Administration (FDA)

- FDA is responsible for protecting the public health by assuring the safety, efficacy and security of       human and veterinary drugs, biological products, medical devices, our nation's food supply,                 cosmetics, and products that emit radiation. 

• Misbranded
• Standards of identity ( the originality of the food )
• Standards of quality ( grades of the product )
• Standards of fill ( quantity )

FDA's food pyramid

National Marine and Fisheries Service

- Agency of the Department of Commerce that controls a voluntary inspection system for fish, fish 

  products, and grade standards.

U.S. Public Health Department

- Concerned with the control of inspections and contagious disease, and also for the safety of some 

  foods.

Environmental Protection Agency

- Conserving water and energy, minimizing greenhouse gases, re-using solid waste, and getting a         handle on pesticide risks.

Department of The Treasury

- The Bureau of Alcohol, Tobacco and Firearms is responsible for monitoring the production,               distribution, and labeling of alcoholic beverages.

The buyer

• The art of negotiation
• Negotiation is  the process between two or more parties (each with its own aims, needs, and viewpoints) seeking to discover a common ground and reach an agreement to settle a matter of mutual concern or resolve a conflict.
• Ethics in purchasing
• Evaluated the goods objectively, and buying decision made on the quality, price and service.

- There are 2 types if purchasing :

• Centralized purchasing 
• Purchase of materials by a single purchase department. 
• This department is headed and managed by a purchasing manager.
• Under centralized purchasing, all purchases made by the purchase department to avoid duplication, overlapping and the non-uniform procurement.
• Cooperative purchasing 
• A purchasing cooperative is a type of cooperative arrangement, often among businesses, to agree to aggregate demand to get lower prices from selected suppliers.
• Retailers' cooperatives are a form of purchasing cooperative.
• It is often used by government agencies to reduce costs of procurement.

Process between Centralized and Cooperative Purchasing

--

The Vendor

- Vendor is a  person or company offering something for sale, especially a trader in the street.

- We need to choose the right vendor in purchasing the goods.

- Evaluate each of the products to ensure they meet the established specifications.

Method of Purchasing

• Informal / Open-market buying
• Purchase of goods, usually in smaller quantities or in an emergency, without contract or negotiations.
• Formal competitive bid buying
• Written specifications and estimated quantities needed are submitted to vendors with an invitation for them to quote prices.

Competitive bidding variations

• Cost-Plus purchasing
• buyer agrees to buy certain items from a purveyor for an agreed-on period of time based on a fixed mark-up.
• Prime vending
• involves a formal agreement with a single vendor to supply the majority of product needs.
• Blanket purchase agreement
• purchased variety of items from local suppliers, but the exact items, quantity and delivery requirement are not known.
• Just-in-time purchasing
• purchased goods in the exact quantities required for a specific production run and delivered just-in-time.

Factors to consider when purchasing

1. Market forms of food
2. Food quality
3. Quality standards
4. Grades
5. Grading and acceptance services
6. Brands

Purchasing Procedures

• Identify
• Requisition
• Inventory stock level
• minimum and maximum stock level must be established
• Quantity to buy
• depends on money, storage space, method of buying, and frequency of deliveries.
• Specifications
• detailed description of a product and should always include :
• Name of the product
• Federal grade 
• Unit on which price was quoted
• Name and size of container
• Count per container
• Issuing bid request
• Provides vendors with opportunity to submit bids for specific items needed
• Developing purchase orders
• Requisition
• Specifies the quantity of each item needed for the bid period, quality and specifications.
• Tabulating and evaluating bids
• Awarding contracts
• general condition include services to be rendered, dates, methods of deliveries, inspection request and many more.

Purchasing procedures

Law and contract management

• Uniform Commercial Code
• Law of Agency
• Law of warranty
• Law of Contract

Law of competition and pricing

• Sherman Antitrust Act
• Federal Trade Commission Act
• Clayton Act
• Robinson Patman Act

Siap lah sudahhhh T_T

Thats all for this topic.