SITXINV003 Purchase Goods: Assessment 1 Project Answer

Answer :

PURCHASE GOODS 

Assessment Tasks and Instructions

Assessment 1

Project

Your tasks: 

Choose an area of operations relevant to your job role which may include:

Food operations

Food and Beverage

Housekeeping

Reception

Tourism outlet

Travel services

Event management

Event management operational area is chosen for this project that helps me in answering the following questions. 

Operation/Department: ________Event planning ________ Job role: _______Manager_______

Provide a brief overview of the operational area, the hierarchy of command and the basic procedures in place for sourcing new supplies and suppliers. If you are not working in industry, explain how this applies in your training environment/department.

Event Operations is considered as the department that helps in integrating and coordinating entire operations of an event and the associated venues of the event (Getz & Page, 2016). Event operation managers are assisted for organising an event after making planning about the basic requirements of the events. Understanding the essential requirements of an event, flexible methodologies and innovation are adapted for delivering best event services to the clients. Moreover, an event manager has also complied with licensable activities and safety regulations in the location of the event. Purpose of successful event operations is to deliver better operational matters of an event in the event venue. 

The hierarchy of command is the event management industry can be reviewed as follows-

• Event manager 
• Team leaders of the individual event 
• Event safety coordinator
•   Event officials 
• Emergency services
• Show coordinator
• General services 
• Vendors & contractors 
• Government Regional 
• Language skill developer or coordinator 

In terms of the event management industry, basic materials of event operations including food and decorative materials are always collected from food dealers, distributors and wholesalers in the market. On the other hand, at the time of managing event permissions of government regional is necessary from all prospects (Davis et al. 2018). In terms of the emergency safety regulations, a specialist response is required in this event management industry. 

Identify and list 6 different types of goods relevant for your area of operations which need to be purchased in the near future. The products must be selected from the following categories:

In an event management company, different types of goods are required to be purchased near future is listed below:

• Alcoholic and non-alcoholic beverages
• Cleaning chemicals and agents
• Food products which include:
• Frozen food
• Dairy products
• Fruit and Vegetables
• Meat products
• Dry fruit
• Storage facility
• Housekeeping staffs and facility
• Uniform for staffs 

List the specific requirements which require the purchase of these goods based on e.g. an upcoming function, banquet sheet, special customer requirements, an event, low stock, reservations or as applicable including the order of urgency for ordering these supplies. Provide details for how you have identified these requirements including consideration of any existing stock you have in storage.

For developing event management, related to a Banquet associated with a marriage ceremony in Australia different goods for an arrangement such as chairs, tables, catering items, cleaning chemical, organic cleaning chemicals, lights will be needed. Apart from that, flowers will need for decoration, dress, as well as car service for the bridegroom. Moreover, the arrangement will be needed for a musical welcome of the bridegroom. For this arrangement, the musician needs to be hired along with electrical equipment. Moreover, in lunch, different dishes will be delivered to the guests and for this reason arrangement of raw materials will be needed in this case. Floor carpets can be considered as another requirement of decoration which will be needed in this regards (Gluckstern, 2018).

Contact the relevant department heads/ supervisor or persons relevant for these product needs and clarify concise specifications and quantities required.Detail with whom you have communicated and what was determined.

In order to manage the functions events of marriage in Australia, the event management company need to determine the price of requirements. In this regard, around 100 tables, 500 chairs, 1000 plate foods, 5 catering sets, 1000 lights, 35 rented cars, 2 musicians and one rented hall. Through taking reference from this concise material of the upcoming marriage events, it becomes possible to communicate with the supervisor (Jones, 2017). Nonetheless, based on required materials the price of the materials is needed to analyse in a proper way.       

Which forecasting methods form the basis for calculating the quantities required? How is the choice of forecasting method established?

Qualitative forecasting techniques use qualitative data for forecasting. Calculation of variables or quantities requires gathering qualitative data. There are three types of forecasting techniques (Brindley & Oxborrow, 2014).

The choice of forecasting technique is determined on the stages of the life cycle of a product at every stage. For an event management organization, this will be event and duration or lifetime of their event.

Identify the stock on hand, list the quantities available and indicate whether these need to be considered in your purchasing order.

For an event management industry, materials related to catering, decoration and cleaning chemicals would be readily available. These materials are therefore termed as stock on hand. The list of quantities that are available (stock on hand) is listed below:

Table 1: Stock on hand items

(Source: Created by author)

These items have to be considered in their purchasing order as these are essential equipment in any event management. In addition to that food and beverages are essential equipment, which needs to be bought.  

Determine the price limitations for 3 products you have listed on your purchase list using job costings from your organisation. How does this affect the maximum price you can pay for the purchase of the product? Why? Are there any processes for this in your workplace or in the RTO? What are these?

Among the purchasing orders, alcoholic beverages, staff uniform and continental dishes of food items are kept from regular budgeting. Staff uniform may or may not be fixed and it can be fixed in accordance with the instantaneous requirement. Alcoholic beverages are kept out of event management list due to variable demand of customers. Some customers favor soft drinks while others favor hard drinks. Hence, without prior ordering, these cannot be placed in the budget. Customers do not generally order continental dishes across the World (Guizzardi & Stacchini, 2015). Therefore, without prior order, these orders cannot be placed; otherwise, the company will suffer a great loss.

The uncertainty of product fluctuation and dynamic pricing affect the maximum pricing capability of an event management organization. Therefore, it can be inferred that the price limitation impacts the maximum price of the purchased products in a negative fashion; as their performance becomes limited by price limitation.

Yes, the forecasting process is used in eliminating price limitation at RTO.  Forecasting method is often used to eliminate the price limitation process at RTO (Adobor & McMullen, 2014). Qualitative techniques and Projection methods are used to remove price limitation.

Write the purchasing list based on your requirements and the stock on hand.

Purchasing list 

Table 2: Purchasing List

(Source: Created by author)

List the suppliers who are used by your establishment to source these products from.

In terms of the item of food and beverage, furniture requirement, cleaning materials and decorations essentials the event management companies will need to overview suppliers of those fields in the Australian market. In the competitive environment of Australia, different event management companies need to drive their focus upon following-

• For the furniture requirements, Arteil group is chosen as the specialist manufacturers in the upcoming Australian wedding functions. 
• Moreover, for the food & beverages Metro Beverage co, are their existing suppliers in the Australian region.
• In terms of having organic cleaning products, Abco Product Pty Ltd is overviewed as their cleaning product suppliers in the Australian region 
• However, for having major decoration materials in the Australian region, HVG decorative building products are their decoration material suppliers in the specific Australian region. 
• Identify the organisational purchasing procedures which form the basis for purchasing goods and sourcing suppliers in your establishment and provide the details for these.

Within the Australian region for purchasing goods and materials, the primarily purchased budget is needed to determine and the receipt of the purchase requisition based on the upcoming events. Through determining the requisition of the upcoming events in the Australian market, materials are needed to purchase accordingly. Apart from that through following up the overall purchase order and placing an order of the upcoming events, specified goods and materials are needed to purchase from the suppliers (Adobor & McMullen, 2014). Primarily by checking the invoices of required products in terms of quantity, price and related terms of product purchasing is needed to overview. Establishing contractual relation between the event Management Company and suppliers, it becomes essential to buy products according to product interest.  

Source 2 suppliers (other than those you currently use) in your area or region and obtain information for prices and service provisions for the 6 products you have identified for purchasing in Question 3. (info may be entered in table) – You are required to list your sources of information

3RT Holding Pty Ltd and Australian Beverage Corporation are two suppliers. The first one supplies furniture whereas the second one supplies beverages. Furniture is obviously classified under decoration items (australianfurniture.org.au, 2019). Australian Beverage Corporation supplies coffee machine (ausbeverage.com.au, 2018). In addition to that, Australian Liquor markets will be responsible for providing hard drink (almliquor.com.au, 2018). 

Using the table below enter the details for product specifications and prices from your existing supplier and those from your 2 new sources.

Analyse and compare the prices and conditions and provide an overview of your findings (given that you would have to make a decision based on the best deal and conditions for supply).

Comparisons of prices have an overwhelming requirement for an event management company. As per findings listed in the above table, it can be identified that, the amount if decoration items, namely furniture is in an adequate amount. It can be justified by the requirement of their number of furniture. They only require 250 furniture only. From the beverage perspective, it can be seen from the table that the hard drink and beverage making equipment is quite low in amount. Only 75 brands of hard drink and 125 coffee vending machine are available in the stock the event management company. They have to buy or import more hard drink categorized beverage. In addition to that, they have to buy more coffee vending or tea vending machine for better utilization of time.    

Price optimization is therefore required in business process of event Management Company (Krumeich et al. 2014). Some of the products are listed beyond the price limitation such as continental dishes and staff uniform outside of their equipment list. Price limitation thus arises. In order to limit price limitation, price negotiation has to be considered.

a. 

The event management company buys furniture from Arteil and it costs 30$ per furniture. The two new furniture companies provide furniture at $50 per furniture and $58 per furniture. Beverages and coffee machines are required to expend 116 and 200 dollars respectively. Currently, 225 per unit cost have been estimated.

b. $ 50 per furniture and $ 58 per furniture is going to be spent behind furniture, whereas 316 dollars are to be spent behind beverage requirement.

c. A corporate account has to be established in order to pay the suppliers with necessary fees. Cash Sale is recommended along with that 

d. Catering equipment, Chemicals and Decoration items are readily available in their stocks. Other items are required as per client’s demand.

Conduct an assessment of the quality of goods for the suppliers of goods identified in Question 14. List the methods you will employ to do this to ensure you will get quality supplies. Your responses need to include reliable processes to ensure quality will be ensured.

The quality of goods is as per industry standard and in accordance with their price. A greater quality of goods is utilized. A greater quality of goods ensures their success. Price negotiation strategy is further recommended for better utilization of materials. Raw materials are well utilized in by event Management Company for better generation of profit (Müller, 2015). Upcoming event management has to be supported by the event management company for better acquisition of customers. The item that has been brought will be utilized in future upcoming events.

Take your findings to your trainer or Supervisor and discuss the options for further price negotiations. What has been discussed and determined, and how does this fit in with the requirements established in Question 11? 

Through sharing information with experts of the event management industry, it becomes the primary concern to negotiate the price of the entire range of products. On the other hand, through reviewing the reduced customer expenses in the Australian market, the product price is negotiated accordingly in an advanced manner (Musgrave & Henderson, 2015). According to the provided purchase order by event management organization it can be noted that price level of hired chairs are very high and an expected value of this can be 5500 AUD. On the other hand, the rate for table and catering items is also high and in this case, the expected price rate will be 3500 Aud. However, the price of dress for bridegrooms is according to the market price hence no negotiation is needed for rate of these items. 

Write the purchase order(s) following the analysis and discussion with your trainer and specify the order of priority according to the needs identified in Question 4.

Purchase order

Company name: 

Date: 23/03/2019

Vendor: Suppliers 

Ship To:

Draft emails for each supplier you have determined for sourcing your supplies and inform each supplier of the requirements and specifications you have determined. Ensure the details of your organisation and the supplier clearly feature in the email including contact details, salutation, dates/timelines, etc.

Attach the relevant purchase order(s) for each supplier as relevant.