Final answer:
Purchasing and procurement are two related concepts in business, but they have distinct differences. Purchasing is a transactional activity focused on buying goods or services, while procurement is a strategic process that involves acquiring goods or services and managing supplier relationships.
Step-by-step explanation:
Purchasing and procurement are two important concepts in the field of business. While they are related, they have distinct differences.
Purchasing refers to the process of buying goods or services for a specific price. It involves selecting vendors, negotiating prices, and creating purchase orders. Purchasing is a transactional activity that focuses on obtaining goods in exchange for money.
Procurement, on the other hand, is a broader term that encompasses the entire process of acquiring goods or services. It includes activities such as identifying needs, defining requirements, selecting suppliers, negotiating contracts, and managing relationships with suppliers. Procurement is a strategic process that aims to ensure value for money and long-term supplier partnerships.
In summary, purchasing is a subset of procurement and is focused on the transactional aspect of buying goods or services, while procurement is a more comprehensive process that involves strategic decision-making and the management of supplier relationships.