What is meant by the right quality and right quantity at the right time and at the right price
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Logistics Procurement Supply Chain Government Procurement Question added by Mohammad Fayyaz , Deputy Site Manager , Raha Group for Technical Services (RGTS) Upvote (0) Views (10) Followers (4) Comments (3) Report Question Write an Answer
 by Carole Abdel Salib , FOREIGN LOGISTICS MANAGER , KHOURY INTERNATIONAL It is simply called a Definition of Purchasing. Upvote (0) Downvote Reply (0) Report by Hatem Bata , Senior Logistics Officer , International Rescue committee Material Requirements Planning ( MRP) is designed to answer three questions:
Upvote (0) Downvote Reply (0) Report by Jean Louwrens , Graduate Program , DSV Air & Sea It would be called The four Rs of Supply Chain Management but it is actually: - Right Time - Right Place - Right Quality - Right Quantity - Right Place Making it The 5Rs of Supply chain Management Upvote (0) Downvote Reply (0) Report Popular SearchesAccountant Jobs Engineers Jobs Software Engineer Jobs Sales Jobs Sales Executive Jobs More Questions Like This
Do you need help in adding the right keywords to your CV? Let our CV writing experts help you. Get Help Irrelevant to Specialties or not an answer. Inappropriate or offensive. Spam (unsolicited advertising). Purchasing & Supply Chain expert Naomi Clews, MBA MCIPs provides her own personal experience of the 5 Procurement Rights and provides a practical guide on how to use the 5 Procurement Rights to help you Get Procurement Right! Why are the five Rights of Procurement important?The 5 Rights of Procurement are inter-linked, each having an effect on the other. Therefore, the importance of the five Rights of Procurement is the impact the failure to achieve one Right has on the success of achieving all 5 Procurement Rights. Collectively, the achievement of all 5 Procurement Rights, provides a framework for effective purchasing and supply chain management that applies to all industries, sectors and countries. My Personal Experience In the noughties, I worked as a demand planner for a wholesaler. I was interested in supplementing my practical procurement experience with procurement theory. I did my research and decided it was the right time to progress, professionally in my career by studying towards the Chartered Institute of Purchasing and Supply Chain Management (CIPS) procurement qualification (MCIPs) at Stoke on Trent college. The cost of the CIPs course was at the right price, consisted of the right quality of teaching and the right quantity of exams. But, I quickly realised I was not working in the right place. At the time, I worked Monday to Friday 9 to 5, typical of an office job in the UK. The first year of the CIPs course consisted of 6 modules. It was taught one day a week between 13:00 hours to 21:00 hours. I quickly realised I would require an afternoon away from my work to attend the college course. I plucked up the courage to approach my manager. I explained that I wanted to study procurement. I provided reasons why it would be beneficial for the company to let me study for the qualification. I was very clear that I would pay for the course and offered to ideally make up the time throughout the week or I would take the time off unpaid. My manager was not supportive of my request for flexibility in my working week. He said it was against company policy to allow people time away from work for training and development purposes. My manager was shocked when I came back (a short time later after discussing the situation with my partner) and promptly handed in my notice and submitted my CIPS student membership application. My determination and courage was evident to the college, who fully funded my first year of CIPs study. I have no regrets about my decision to leave that company. I recognise it as one of the most important decisions of my career. I quickly found a new employer who understood the benefits of supporting employee continuing professional development. They embraced employee learning and skills development and they benefitted from my learning, during my time with them. After 3 years and 16 CIPS exams later, it was a proud moment when I achieved MCIPs status. Even better, I achieved a £10,000 pay rise and a further 3 years support and encouragement to achieve an MBA at Staffordshire University. I would not have landed this fantastic job (where I remained for 8 years) had I not had the courage to pursue my MCIPs qualification. The first thing I was taught in my CIPs foundation year was the importance of the five rights of purchasing which are as relevant today as they were in 2003. With the management and mitigation of risk at the heart of purchasing and supply chain management, how do you achieve all 5 Procurement Rights? I will now guide you through each of the 5 Rights of Procurement in more detail. Right 1 - The Right QualityThe Right Quality is a product or service that meets the standards, features and performance set out in the specification. There is often a compromise in the Right Quality to achieve the Right Price. Get The Right Quality By:
Suppliers could effectively solve your quality problems for you, if you can motivate them to innovate. For example, output-based specifications encourage a performance partnership often resulting in the:
Incentivising suppliers to provide higher levels of quality, over and above ‘the quality’ specified in the contract, may help to harness the suppliers’ unique skills, capabilities and create efficiencies. Greater profitability, longer term contracts and loyal customers are amongst the many reported benefits for suppliers who engage with buyers in this way. This approach is superior to the conventional cost plus or fixed price transactional contract where the supplier has no incentive to do anything above and beyond provide ‘the minimum quality’ to fulfil the contract. Right 2 - The Right QuantityThe Right Quantity is achieved through accurate demand forecasts for products and services on a daily, weekly and monthly basis. By interrogating historical demand, it is possible to forecast future demand with a degree of certainty. However, factoring in new developments which may either increase or decrease demand, is paramount. Get The Right Quantity By:Maximise inventory levels by segmenting spend into the following categories:
and determine for each spend segment the:
This supports stock rotation and ‘Just In Time’ deliveries (see ‘Right 4 - Right Time’) to avoid stock depreciation and obsolescence. Right 3 - The Right PlaceThe Right Place is often the optimum receipt and delivery point for goods and services. Get The Right Place By:Using a central store for the receipt and onwards distribution of goods, thereby reduces the need for unnecessary movement and handling. When choosing suppliers, scrutinise their accepted methods of order placement, minimum orders and lead times. Determining the optimum location of your suppliers may also involve Corporate Social Responsibility, environmental and ethical considerations. Right 4 - The Right TimeThe Right Time is closely linked to the Right Quality, Quantity, Place and Price. Economic factors such as supply and demand and the urgency of the order, can impact on all the 5 Rights of Procurement. The Toyota Production System made the Just in time approach to inventory management a proven way to reduce supplier’s response times. Where Kan Ban cards are used to signal a depletion of inventory which triggers the replenishment of stock. Consumption drives demand for more inventory and eliminates the ‘Just In Case’ ordering mentality, which often leads to waste. However, as the Covid-19 Coronavirus Pandemic has tested the world's supply chains, they are not always as robust as they first appear. Get The Right Time By:Using wholesalers or digital marketplaces to fulfil small, frequent orders at the expense of an annual delivery cost. Low value non-critical items such as stationery are a candidate for consignment stock. The stationery company will manage the inventory levels and replenish the stock as required, invoicing only for inventory consumed. Right 5 - The Right PriceThe Right Price refers not only to the initial price paid but to the:
Get The Right Price By:Incentivising suppliers to deliver solutions and activities, can result in higher service levels at the same or lower cost. Furthermore, the use of gain share agreements and working collaboratively to share the risk and rewards (from pooling resources) is an excellent way of motivating suppliers to innovate and take cost out of their goods and services. In Summary The 5 Rights of Procurement provide a simplistic view of how to successfully manage your suppliers and your supply chains. Procurement professionals put the 5 procurement rights into practice to manage supply chain risks in real time. About the Author Naomi Clews MBA MCIPS is a qualified procurement professional who owns an independent procurement consultancy business based in Birmingham UK. With over 25 years knowledge, skills and experience of purchasing and supply chain management (across private and public sector industries) Naomi provides procurement services to her client base to help them Get Public Procurement Right! Find out more here: www.naomiclewsconsultancy.com What is the right item in the right quantity at the right time?Simply put, logistics is “having the right item – in the right quantity – at the right time – at the right place – for the right price – in the right condition – to the right customer.”
What is meant by right quantity?The “Right Quantity”:
Obtaining goods in sufficient quantity to meet demand and maintain service levels while minimising excess stock holding (which incurs costs and risks), by: Demand forecasting. Inventory management.
How important is it to acquire the right quality of material at the right time in the right quantity from the right source at the right price?The success of any manufacturing activity is largely dependent on the procurement of materials of right quality, in the right quantities, from the right source, at right time and at right price – popularly known as five 'R's of the art of efficient purchasing .
What are the 3 key functions in procurement?There are three main types of procurement activities: direct procurement, indirect procurement, and services procurement.
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