When creating a formal purchasing program, start off by establishing a list of those approved to make company purchases. Next, you need to develop purchasing department policies. Follow this up by setting procedures for all company purchases. You also need to create a purchase order system. Purchase orders authorise expenditures, but also provide the amounts of the expenditures, or agreed upon price between the purchasing department and the vendor. Establish a receiving department and make sure everyone follows the procedures for receiving goods against a purchase order.
