Purchase specification
Purchase specification is detailed list of exactly what you will buy and the conditions under which you will buy them. It comprises the company's standards and rules for purchasing goods. Purchase specifications will depend on the market, just as the menu does. For example, while hamburgers are offered on many menus, the quality and size of the burger the operation's purchaser buys will depend upon whether it is for a roadside truck stop or an upscale urban restaurant[1].
Purchase specification includes all product information, but, in addition, it includes information regarding the pertinent supplier services buyers who sell them products. They usually seek long-term relationships with several primary sources and intermediaries and, before entering into these relationships, want to iron out every detail concerning product characteristics and desired supplier services[2].
Elements of purchase specifications
Purchase specifications typically contain these essential elements[3]:
- a description of the item to be purchased
- quantity of the item to be purchased
- physical specifications
- performance specifications
- the minimum acceptable quality of the item to be purchased
- documentation that is to be provided with the purchase
- services provided at delivery
- terms of acceptance
- terms of payment
- shipping information
- warrantee information
Part of purchase specification
Part of a purchase specification may include:
- details of ethical sourcing
- food air-miles
- fair trade products
- sustainability
Many customers are interested in these areas and if details can be included either on menus or other promotional material it can create additional marketing advantage[4].
Purchase specifications for beverages
Generally beverages are sold and purchase by the brand name label of the product, each having a consistent quality and quantity standard of content for each selling unit. Specification for wines also includes the details of vintage and shipper country of origin, alcoholic content and with the exception of France the grape variety.
It should be particularly noted that as the quality, consistency and quantity are virtually guaranteed the price to be paid for the product is very important, as it the one factor that is not constant. It is for this reason that close attention is given by the purchaser to offers by suppliers of quantity discounts and promotion.
The purchasing of alcoholic and nonalcoholic beverages, like that of foodstuffs, has the aim to purchase the very best quality of items, at the most competitive price, for a specific purpose. As beverages will frequently contribute more to profits than foods, and as they require considerably fewer staff to process them into a finished product for the customer, it is essential that adequate attention be given to this area [5].
Examples of Purchase specification
- Specifications for food items: This would include information such as the size, quality, freshness, and source of the item. It might also include specifications for packaging, labeling, and storage.
- Specifications for electronic items: This might include information such as the brand, model, features, and energy efficiency of the item. It might also include any necessary certifications.
- Specifications for services: This might include information such as the service provider's qualifications, the type of service to be provided, and any necessary certifications.
- Specifications for raw materials: This might include information such as the origin, quality, grade, and purity of the material. It might also include specifications for packaging, labeling, and storage.
Advantages of Purchase specification
A purchase specification has several advantages:
- It serves as a guide for the procurement of goods, ensuring that a company is purchasing the right items, of the right quality, and at the right price.
- It helps to ensure that the goods purchased meet the company’s standards and comply with any legal requirements.
- It helps to reduce the risk of waste and overspending, by clearly specifying in detail the exact items and quantities that need to be purchased.
- It helps to streamline the purchasing process, allowing for a more efficient and cost effective purchase.
- It helps to ensure that suppliers are aware of the company’s requirements and expectations, allowing for better quality of service.
Limitations of Purchase specification
A purchase specification is a detailed list of exactly what will be bought and the conditions under which it will be purchased. However, there are some limitations to this document. These include:
- The purchase specification might not always cover all aspects of the procurement process and may leave out important details such as delivery times or payment terms.
- The specification may not be updated regularly, meaning that changes in the market or company standards might not be reflected.
- The specification may be too restrictive, meaning the company cannot take advantage of better deals or new products that arise.
- The specification may not be specific enough, leaving too much room for interpretation or misunderstanding between the seller and buyer.
- The specification may not be properly enforced, preventing companies from taking action against non-compliant sellers.
Other approaches related to Purchase specification are:
- Vendor Selection - It is a process of selecting the supplier, selecting the right vendor is an important step in purchase specification. It involves assessing the supplier's creditworthiness and their ability to provide the required goods and services.
- Price Negotiation - It is the act of negotiating between the buyer and seller to reach a mutually beneficial price for goods or services. The negotiation process can involve multiple rounds of offers and counter-offers from both parties.
- Delivery - It is the process of delivering the purchased goods to the buyer. This can involve coordinating with the vendor on a timeline and ensuring that the goods are packaged and shipped properly.
- Payment Conditions - This is the agreement between the buyer and seller on how the buyer will pay for the goods. This agreement can include terms such as payment terms, payment methods, and discounts.
Other approaches related to Purchase Specification include Vendor Selection, Price Negotiation, Delivery and Payment Conditions. All of these approaches are important to ensure that the purchase is conducted properly and that both parties are satisfied with the outcome.
Footnotes
| Purchase specification — recommended articles |
| Unascertained goods — Disclaimer of warranties — Distribution policy — Contra deal — Sole distributor — Certificate of approval — Bill of lading — Contract of affreightment — Free carrier (FCA) |
References
- Davis B., Lockwood A., Pantelidis I., Alcott P., (2008), Food and Beverage Management, Routledge, Amsterdam.
- Ojugo C., (2010), Practical Food and Beverage Cost Control,Cengage Learning, Brazil.
- Reeder F.F., Joos A.E., (2019), Fire and Emergency Services Instructor, Jones & Bartlett Learning, Burlington.
Author: Daria Polewka
