What IS the Difference Between Procurement and Sourcing Agents?
If you are new to supply chain management, you’ve probably heard a bunch of new terminology that can seem a little foreign to you. A lot of it is interlinked and some terms are very nearly interchangeable, which can make things seem confusing. Here we will differentiate between strong>product
About Procurement Agents
A procurement agent or purchasing agent’s job is to meet the needs of a company by acquiring the products or materials they need.
They’ll be in charge of assessing stock and ordering and reordering as needed. The avenues they choose to go through will depend on what they are trying to source.
If it’s a part that a company makes in house, the purchasing agent will be responsible for ordering the materials to make that part and any stock parts such as screws or bolts that is a part of it.
If it’s a company’s custom product they are looking to produce outside of their company then a procurement agent will have some different options on how they will buy the parts.
Parts that require assembly will have to be procured through quite a few different sources, especially if there are many different kinds of parts such as circuit boards, housings, and post manufacturing processes like anodizing.
A procurement agent will also have to handle logistics and keep track of what shipments will arrive when so that their company can be kept abreast of when to handle their orders.
Typically purchasing agents work internally for larger companies that handle large volumes of materials and orders. The responsibilities of a procurement agent are usually meshed with other jobs for smaller corporations, as they won’t have to invest as much time tracking shipments, finding new suppliers, or keeping as tight an eye on their inventory.
About Sourcing Agents
Sourcing agents will help a client who needs a part or product made find a manufacturer to do it.
They will handle finding all the manufacturers needed to make a product; sometimes it takes more than a single factory to make a product if the product has components that require different types of manufacturing. They will also arrange, if needed, any assembly, post manufacturing processes, and the logistics.
Sourcing agents are there to handle all the parts of procurement, yet they usually work for an outside company. This can be advantageous because not every company has the resources to hire a full time purchasing agent, where sourcing companies usually work on a per order basis.
How Sourcing and Procurement are Different
While both agents primary task is to acquire, the largest difference between procurement and sourcing is that a procurement agent works directly for a company. They’ll contact suppliers directly, organize any post production processes like plating or anodizing, and can also be responsible for arranging logistics.
A sourcing company on the other hand, will take care of all that was just listed, but you contract with them to take care of it. Sourcing agents will be part of an outside company that will remove the headache of the above tasks and processes internally as they take them on instead of your company. They can also end up saving more time and money since usually they will have long established relationships already.
Most procurement agents work for large corporations, sourcing companies will work with anyone(big or small) so long as they can order past a minimum order quantity.
Looking for Sourcing Specialists?
Look no further. At Global Trade Specialists, we have partner companies in 3 areas of China that we’ve used to source products for our customers for decades. If you are looking for help with sourcing, get in touch with us to see if we can help you with your product!