NVQ Level 3: Ordering Products and Services in Business and Administration
Introduction to This Unit
This unit is a Group B optional Level 3 unit with 5 credits, quite a long unit. On completion of this unit, the candidate will be able to identify and use different products and services, write specifications for products and services and make sure that the products and services comply with the expectations and standards of the organisation or company.
The candidate should be able to explain the reason why good quality products are chosen, but with the best value for money. They should also be able to explain how to negotiate the best value for money. The candidate will need to know how and why to maintain good relationships with suppliers and service providers and also know and understand what a supply chain is, and how it works.
In addition to this article, there is a personal statement that covers a majority part of the unit!
P.S: On a kind note, please do not copy anything submitted here and display it in your file. This has been published purely to help you gain an idea / understanding of what they expect you to write and how you have to write. You will have to relate to your own work area and organisation and stick with it while preparing the files. Thank you for your cooperation.
1.1 Identify different sources of information on products and services for an organisation.
Companies always look for information for the products they use in different sources and providers, so that they can make a good decision regarding what they need to make their business effective. They look through the costs of products with different companies; they look at price of individual services and find the best match, i.e. the product that best suits their organisation with regards to cost and quality. Information for these can be gathered through catalogues, websites, newspapers, leaflets or by ringing and visiting companies.
1.2 Explain how to use different sources of information on products and services.
Information on products and services are either available online or in booklets or can be obtained from the company direct. One has to use this information to identify the service or product that best suits the company’s and employees’ needs. Different sources also help to compare different products and services in order to choose the right one. We can request them to send us samples and catalogues to have a look at costs and quality. Also for bulk purchases we can request quotes and choose the best one.
1.3 Describe how to write a specification for a product or service.
The specification is a description of what items you want to buy and what the supplier has to quote and provide.
When writing a specification for a product:
- The guidelines need to be clear and short.
- It has to include the costs, quantity and specify whether it is for delivery or collection.
- It also needs to include health and safety manuals or notes.
- Make sure you understand what is required.
- Research the market thoroughly by talking to various suppliers regarding costs and delivery time scales
- Identify the possible risks associated with the procurement of products
- Have a clear understanding of the goods and services by each provider
1.4 Identify sources of products and services that meet the quality expectations of an organisation.
When selecting products and services for an organisation, make sure you get quotes from different service providers and companies, so that you can compare the different services and choose the one that is cost effective. The second thing to bear in mind is the quality. Compare different services, and make visits to the companies to see what services they provide and witness the quality of services before choosing what to buy. Quality means a lot for an organisation.
Once the above are completed, compare to choose the best service that is both cost effective and of good quality, and purchase them.
1.5 Explain the purpose of selecting products and services that meet the quality expectations of an organisation.
Every organisation thinks well before hand before purchasing any products. They buy only things that are required. To be successful in their business they have to buy products or services with a clear understanding of what the requirements of their clients are. Only if the organisation selects products and services that meet the quality expectations, they will be able to provide the best service for their clients.
It is also essential for the benefits of the employees working for the organisation. For an organisation to be successful and effective, quality has to spread across all people, departments, activities and functions.
1.6 Describe how to negotiate best value for money.
Negotiating best value for money is important so that you stay on top of your budget and also save on spending. Before negotiating, gather as much information about the products or services you wish to purchase and after that make sure that the service or product is qualitative and useful for the organisation. Check the same product with different companies; you can do this by researching online, checking booklets, ringing companies or visiting them personally.
Once decided go for an asking price and stay firm on it. You should be ready to walk away if the supplier does not agree. They might come back to you for negotiation or another company can provide you competitive rates.
1.7 Explain the purpose of developing and maintaining good relationships with suppliers and ways of doing so.
Maintaining good relationships with suppliers is good business practice. It benefits both the organisation which is you and the supplier. Suppliers can provide you offers and be flexible with doing business if your relationship with them is good. Always make sure you settle all accounts in time, be considerate to the sales representatives, place orders well ahead of time, giving the supplier enough time to deliver it to you in time, rather than doing it at the last minute and finally be very cautious about damaged or missing goods. It has to be dealt with care.
1.8 Describe a supply chain and how it works.
According to Wikipedia and other definitions on the net,
"A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer".
In a supply chain various activities take place, like transformation of a product from a natural resource or raw materials into a final or finished product that will be delivered to the client or customer. Supply chain consists of all the parties involved like production team, the company, the supplier, the organisation to whom it is delivered and the customers who purchase it. It is basically the manufacturers, the suppliers or wholesalers, the retailers and the consumers.
In short a supply chain gets a product through from a supplier to a consumer and every individual involved in the chain contributes to the supply chain.
2.1 Describe the procedures for the ordering and supply of products and services for an organisation.
Ordering and supply of products and services for an organisation is a very important task, as it involves looking after the customers. Products might include basic things like office supplies like printing material, stationary, IT equipments etc, which can cost a lot of money. Services might include any service taken from a different organisation or provider. For example our organisation takes in services from the NHS and care homes.
When ordering services and products, the person responsible has to order enough quantity, so that they do not run out on stock and affect the functioning of the organisation. For example, if we run out on envelopes, printing material etc, it can affect the organisation in various ways.
The following procedures have to be followed while ordering products:
- When ordering office supplies, state the clear and exact details of the products including product code where possible.
- The size, colour and any other details should be specified
- Make sure you get the order form authorised by the office manager
- Ordering can be done through an order form or through catalogues on the system, and in our office it is done on SRM.
- When the stationary supply order is delivered, it should be thoroughly checked item by item to ensure all the requested supplies in the requisition order have been correctly delivered and in the correct quantity ordered.
- The requisition order is signed by the person who checks the supplies to show that the order delivered is agreed with.
- Any item found not correct or damaged in anyway should be returned as soon as possible and replaced by the supplier to avoid any unnecessary delays.
2.2 Describe the needs and priorities for the ordering and supply of products and services for an organisation.
When ordering products and services for an organisation, check to see if they are really essential for the organisation, and how it is going to help the smooth running of the organisation, what are the pros and cons, who need it, and what will be the other advantages of using those products and services. Also prioritise products according to their needs and order only the most essential ones, as ordering everything requested can cause a problem later in the financial year on the budget.
2.3 Explain the purpose of having organisational policies for the acceptance of gifts and hospitality.
It is important for an organisation to have in place a written policy that regulates the relationship between the Company, its staff and the external environment. Every organisation has a policy regarding accepting gifts. In our company, accepting gifts or hospitality without authorisation or disclosure is not acceptable. This clarifies the standards for the organisation and tells the employees what is expected of them and safeguards the company or organisation. Accepting gifts can give rise to suspicion of improper conduct.
According to the Gifts and Hospitality Policy,
The Gifts & Hospitality Policy lays down the underlying principles of accepting and refusing gifts and hospitality, as well as providing a methodology for the recording of such instances.
3.1 Explain the purpose of monitoring and evaluating procedures for the ordering and supply of products and services and ways of doing so.
Monitoring and evaluating procurement procedures is an integral part of the management of an organization. A high level of attention and concentration is involved during the procurement process. Any order has to be monitored and evaluated to avoid loss for the organisation.
Monitoring: In this process the products are reviewed on a continuous basis. Orders are monitored to see if they are completed by the required time and if the target is being met, which includes budget and other needs. By monitoring, one can take necessary actions if any problems occur and prevent any bad practices.
Evaluation: Thisis done to analyse progress towards objectives and goals that have already been established. In all organisations, products and services should be evaluated on a monthly, quarterly or yearly basis depending on their capacity or capability. It helps to keep track of whether objectives and plans have been met, thereby paving a way for future plans.
These can be accomplished by
- Develop a checklist to see if procurement procedures are being followed. Prepare the checklist with discussion between team members and members of the organisation, as it is to do with everyone and not just you
- If there are any concerns, it can be identified by following a chart or graph. Areas of risk can be identified and solutions can be sought from experienced people.
- You should track and trace each procurement, through the entire procurement process.
- Also always determine if the procurement method used was appropriate for the goods or services being acquired.
- Document all procurements and transactions.
3.2 Describe actions that may be taken to improve efficiency in the ordering and supply of products and services.
Efficiency in ordering and supply of products and services can be improved by doing the following:
- Order through the system provided by the company to avoid any problems.
- Choose the most cost effective and qualitative company
- Always keep a list of items to be ordered, if ordering is done periodically, for example, once a month, so that you do not miss out on any items.
- If you do not receive an order on time, check with supplier to see what the reason is.
- Make sure you choose the correct items with correct codes and quantity, and always check to see if orders above a threshold limit have been approved by the manager.
- Once the order is supplied, check invoice and goods receipt the invoice and send it to the central payments team, so that supplier is paid on time.
3.3 Describe ways of getting better value for money for products and services provided.
All public procurement of goods and services must be based on value for money. Value for money is not about achieving the lowest initial price, but about quality and cost for qualitative service
Better value for money from procurement can be achieved in many ways:
- Getting an increased level or quality of service at the same cost.
- Avoiding unnecessary purchases, as this wastes money.
- Ensuring that user needs are met qualitatively.
- You can always work together with other departments and place bulk orders, as there can be better discounts from bulk buying.
- The relationship between you and the supplier has to be good in order to have cost effective business.
Why is it important to select products and services that represent best value for money?
When choosing products and services, it is important to choose the ones that represent best value for money at any time. This is important because:
- It has a right balance between cost and quality and these services are the most reliable.
- Best value for money leaves both the supplier and the customer happy as the balance rules out disagreements.
- It helps build customer-supplier relationship
- These products last longer and save on so many other small expenses. For example, when you look at the cost of an expensive product, it will be a lot cheaper when compared to the total lifetime cost of a product bought initially cheaper and then had other small expenses on it through its lifetime.
- The delivery times will be quicker, thereby saving losses in the business and its operations.
- Payment terms will be flexible and the prices do not vary often.
- This way you save on money without sacrificing quality, but best value for money always does not mean saving money. For example, a supplier who provides quality service with quick responses for a higher price can still be best value for money, as you have received quality services for the money you have spent.