Topic > Difference between purchasing and traditional purchasing

1.1: The traditional purchasing cycle. Traditional purchasing strategies faced issues, on the side of the buying organizations, such as the cost of preparing invoices and documents to obtain payment, and with respect to the seller, the time required to receive payment and the cost of delaying a purchase order. purchase or honor an invoice, leading to problems where sellers refused to take part in the process and those who were willing to do so, charged high prices to cover increasing any of the costs mentioned above (Parikh and Joshi, 2005) In modern context, purchasing strategies follow the concepts of both relational purchasing and performance. Modern purchasing strategies such as green channel suppliers, which consists of creating close buyer-supplier relationships that allow the organization to obtain special discounts on its purchases, obtain highly sought-after items, exchange "mutually beneficial" information on new products, materials primes and trends (Monczka et al., 1998; Purdy and Safayeni, 2000, cited in Parikh and Joshi, 2005), the rise of e-procurement, where buyers can search for suppliers on e-procurement websites, allowing so buying organizations purchase with “quantity discounts” and get “special offers” (searchcio.techtarget.com, 2016). Other forms of modern purchasing strategies include reverse auction, where the primary objective is to compete for the lowest purchase price (Purchasingauctions.com, 2016), competitive bidding where the organization