A purchasing supervisor manages the purchasing group, reviews purchase requisitions, controls costs, and works with program management and production schedulers. They also review purchase price variances and control excess and obsolete costs.
A purchasing supervisor is a type of manager responsible for the purchasing group. As part of their job, purchasing supervisors support business operations by reviewing purchase requisitions, approving purchase price variances, and controlling excess and obsolete costs. If the purchasing supervisor is employed by a manufacturing facility, he is also responsible for working with program management and production schedulers to determine when material will be available for product build operations.
Purchase requisitions are requests to purchase products to support customer orders. A purchasing supervisor reviews purchase requisitions and determines what needs to be ordered. The actual order entry is performed by buyers who work for the purchasing supervisor. Typically, these purchase requisitions are output from an ERP (Enterprise Resource Planning) system. Before authorizing buyers to place orders with suppliers, the purchasing supervisor will meet with members of the management team to confirm that customer order demand and plant capacity are sufficient to support these orders.
Purchase price variances (PPV) result from a quoted unit price higher than the default unit price loaded into the ERP system. An unfavorable PPV can potentially make the company less profitable; therefore, the purchasing supervisor must review any unfavorable PPVs to determine the cause. If the cause is due to customer-induced issues, such as on-time requests or smaller quantities needed than originally quoted, the purchasing manager will submit a request to the program manager to retrieve the customer’s PPV. If the cause is related to buyer error or other non-customer induced issues, the purchasing supervisor will perform the root cause analysis and provide additional training or process updates as needed to prevent the issue from occurring in the future.
Purchasing managers are also responsible for controlling excessive and obsolete costs. Surplus is the amount of material owned by a company that is greater than the demand supplied by the customer. Obsolete refers to any material that has zero demand, therefore, no use. Purchasing supervisors periodically review on-hand and order details to ensure there is no idle material.
In the event that a change in customer demand causes excess material, the purchasing supervisor will work with the buyers and attempt to return the excess to the original supplier. After due diligence, any material still idle is usually submitted to an excess claim to the customer for payment. Obsolete material is usually due to an engineering change that may have removed a specific component from the bill of materials. Purchasing will attempt to return the parts or find another way to use them. If this fails, an obsolete claim will be sent to the customer.
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