Procurement, Stock and Inventory Management in NGOs – NGO Financial Management Policy

continued (click here to know more)

As NGOs receive funding, implement projects and expand their offices, they will be required to make purchases of goods and services. Ideally, it is better to draw up a plan for making such purchases and also outline it in the financial management policy.

12. Procurement, Stock & Inventory

12.1 Purchasing

The purchasing function involves:

a) Identification of needs, for goods and services,

b) Identification of costs to cover the needs for those goods and services,

c) Identifying the suppliers, procuring estimates (at least three)

d) Negotiating favorable trading terms with them,

e) Placing an order.

f) Receiving the goods and/or services and paying for them

g) Preparation of accounting and archiving expenditures.

12.2 Identifying the Supplier

The purchasing function involves:

a) Credibility   of   the   supplier   in   terms   of   being   able   to   supply   the requirements and in time

b) Cost effectiveness of the goods supplied

c) Quality of goods supplied

d) Supplier should meet all necessary formalities in connection with its status as per the rules and regulations of the Government.

e) Supplier must be able to supply all the good in the requisition/or of the specification prescribed in the purchase order

f) Must be local, reliable and known

g) Must be able to supply large quantities if necessary

h) Past performance

i) Availability of supplier

j) Reputation of supplier”


  1. Avatar Ahmad Shaheer Anil says

    Very Useful stuff.