How to make a procurement plan

A procurement plan is the end product of a well-defined procurement strategy. Ideally, a good procurement plan ensures that purchases are time-bound, in line with compliance metrics, and directly support the organization’s business goals, aligning with the available budget and reducing spend.

To create an effective procurement plan, stakeholders can start by aligning their procurement activities with the overall business goals. Then, a spend analysis will keep them up-to-date about their organization’s purchasing needs and patterns and help define clear procurement objectives.

Procurement objectives can vary based on an organization’s policies and needs, varying from cost savings to supplier diversification. These objectives can help map out sourcing strategies, define timelines and budgets, and set up approval workflows. Once roles and responsibilities are defined, a thorough procurement risk analysis will help identify potential risks and recommend effective mitigation strategies.

After which, organizational and regulatory compliance policies could be sketched out and put in place to help track progress and monitor procurement KPIs in real-time. Throughout the creation of the plan, it is essential to keep stakeholders engaged to ensure buy-in. Regularly reviewing the plan can help you adapt to any changes in the market or organizational priorities.