Direct Procurement and Indirect Procurement

[Former Member]

HI Gurus,

Is purchasing below example of Direct Purchasing or Indirect Purchasing?

Car Fluids

Coolant

Brake Fluid

Assumption: Car manufacturing Company buys the above from external suppliers, puts them into each of his new assembled cars before selling the cars to customers

Thanks!!

[Former Member]

Hi Ankur

The products you mentioned above  are all materials, therefore will fall under direct procurement

whereas indirect procurement covers service items i.e. transport, shipping, engine maintenance etc..

Hope it helps

Regards

[former_member226243]

Hi Ankur,

As per the products given by you. If the company is procuring such products via catalog supplier, where we have pre-negotiated price. Then such products can be considered under Indirect Procurement.

Regards,

Abhishek