Purchasing and Procurement Flashcards

Which purchasing method involves buying goods in large quantities to obtain a lower unit price?

Answer: Volume or quantity buying

Volume or quantity buying leverages large purchase orders to negotiate lower per-unit costs, reducing overall supply expenses.

What is a 'par stock' level in housekeeping procurement?

Answer: The minimum quantity of a supply item needed to meet operational demands between deliveries

Par stock is the established minimum quantity needed to sustain operations until the next scheduled delivery without running short.

Which document formally requests a vendor to supply goods or services at a specified price?

Answer: Purchase order

A purchase order is an official document sent to a vendor authorizing the purchase of specific goods or services at an agreed price.

What is the primary purpose of obtaining competitive bids from multiple vendors?

Answer: To ensure the best value for the hotel's money

Competitive bidding ensures the property receives the best combination of price, quality, and service by comparing multiple vendor proposals.

A 'blanket purchase order' is best described as:

Answer: A standing agreement to purchase a set quantity of goods over a defined period at a fixed price

A blanket purchase order establishes a long-term agreement with a vendor for recurring purchases, locking in pricing and simplifying the ordering process.

When evaluating a vendor for housekeeping supplies, which factor is MOST critical beyond price?

Answer: Reliability of delivery schedules and product consistency

Reliable delivery and consistent product quality ensure housekeeping operations run smoothly without costly shortages or substitutions.

What does the term 'lead time' mean in procurement?

Answer: The period between placing an order and receiving the goods

Lead time is the elapsed time from submitting a purchase order to receiving the goods, which must be factored into reorder point calculations.