Procurement and Sourcing refer to the processes organizations use to acquire goods, services, or works from external suppliers.
Procurement is the broader process that involves identifying needs, selecting suppliers, negotiating terms, contracting, and managing the purchase of goods and services. It covers everything from strategic planning to the final acquisition and payment.
Sourcing, on the other hand, focuses specifically on finding and selecting suppliers or vendors to meet the organization’s needs. It often involves assessing the market, evaluating supplier capabilities, and establishing long-term relationships.
In short, procurement is the overall process, while sourcing is the key part of it that ensures the right suppliers are chosen. Both aim to ensure cost-effectiveness, quality, and reliability.
- Teacher: kibet charles