Purchase management software for Pakistani traders

Why buying needs as much care as selling

Shop owners watch the sales counter closely. Purchases often get less attention: the supplier's salesman comes, an order is placed on trust, goods arrive, and the bill goes into a drawer. Yet every rupee of profit depends on what you paid. Buy 5% too high, or buy goods that sit for six months, and no amount of selling makes up for it.

Purchase management means three things in practice: buying the right quantity, checking that what arrives matches what was billed, and paying suppliers on time without paying twice.

From order to payment

1. Decide what to buy. Check the low-stock alerts and current stock in Taajir before ordering, so you do not buy what is already in the godown.
2. Place the order. Agree quantity and rate with the supplier and raise a purchase order in Taajir. Our guide to the purchase order process explains why this matters.
3. Receive and check goods. Count what arrives against the supplier's bill. This is the job a goods received note does in larger businesses.
4. Record the purchase. Enter the purchase invoice in Taajir. Stock goes up and the supplier's balance increases.
5. Return what is wrong. Damaged or short goods go back with a purchase return and a credit note.
6. Pay the supplier. Record each payment out against the supplier, so the ledger shows what is still due.

A worked example: what did that stock really cost?

An auto parts dealer in Karachi buys 100 cartons of engine oil from a Lahore supplier at Rs 2,400 per carton. The invoice is Rs 240,000. But the goods also cost freight and unloading before they reach his shelf.

If he sets his selling price at Rs 2,600 thinking his margin is Rs 200 a carton, the real margin is Rs 120. On 100 cartons, that is Rs 8,000 less profit than he thought. This full figure is called landed cost. Taajir's landed cost handling adds the freight and unloading to the purchase, so the stock is valued at Rs 2,480 a carton and the margin he sees is the real one.

Keeping supplier balances straight

Continuing the example, the dealer pays Rs 150,000 by bank transfer at delivery. His ledger for this supplier now shows Rs 90,000 payable. Next month, when the supplier's recovery man calls asking for Rs 100,000, the dealer opens the ledger, sees Rs 90,000, and can show every bill and payment behind it. If 5 cartons had arrived leaking, a purchase return of 5 × Rs 2,400 = Rs 12,000 would bring the balance down to Rs 78,000, with a credit note against the supplier. Paying the wrong amount, or paying the same bill twice, is one of the most common and least noticed leaks in a trading business.

Supplier balances in Taajir are part of your accounts payable. Seeing them next to customer balances helps you plan cash: if retailers owe you Rs 400,000 this week and you owe suppliers Rs 350,000, you know how much collection you need before you can pay.

It also helps at the supplier's year-end. Many companies send a balance confirmation and ask you to agree their figure. With every purchase and payment in Taajir, you can match their statement line by line and find any bill they have and you do not, or the reverse.

Buying smarter with your own history

• Rate history. Before agreeing to a new price, look at what you paid last time and the time before.
• Slow movers. Compare what you bought with what you sold. Items that keep arriving but rarely leave should be ordered less.
• Supplier comparison. If two suppliers sell the same item, your purchase records show who gave the better rate over the year.

Price

Purchases are part of Taajir along with sales, stock, ledgers, expenses and reports. Standard is Rs 4,000 a month, or Rs 36,000 a year, for one stock location. Business is Rs 5,000 a month, or Rs 50,000 a year, for multiple warehouses. Try it free for 7 days at taajir.pk.