Procurement operations : an empirical study about the reality of Portuguese SMEs

Abstract

The purchasing operations in industrial companies affect the supply chain management. Improving procurement allows companies to gain competitive advantages in the purchasing process. However, the top management of companies does not always realize its importance. The purchasing operations are responsible for acquiring production assets and equipment or subcontracting services with high economic value. Companies with different organizational structures, sizes or certification requirements carry out their procurement process and purchases in different ways. Thus, the main objective is to identify how procurement strategies are applied in the industrial purchasing process, by assessing the frequency of market sourcing, the level of formality to select a supplier and the use of information systems in the support of purchasing operations through a survey application. The survey was divided into 6 main sections: (1) company characterization; (2) respondents’ characterization and their experience in the purchasing operations; (3) parameterization of the purchasing operations; (4) assessment of relationship with the supplier; (5) use of information systems in procurement; and (6) the global evaluation. A sample by convenience was selected, by sending the survey to a group of pre-selected companies. Thirty-two valid responses were collected over a period of approximately one year. The data obtained were processed and analyzed using MS Excel® spreadsheets and descriptive statistics. Results show that, of the 32 surveyed companies, a total of 24 have a formal department dedicated to purchasing operations. A percentage of 47% of the companies allocate up to 3 employees of their workforce to carry out purchasing operations. A share of 16% indicated that the company has 15 or more employees assigned to the purchasing function and 80% of those correspond to companies with a total staff greater than 250 employees. Regarding supplier selection strategies, only 50% of companies claim to always negotiate purchases with the suppliers, namely prices and delivery times. A share of 85% of the ISO 9001 certified companies use ERP systems and all companies with more than 250 employees included in the study use ERP to support procurement operations.