BUSINESS FINANCE OPERATION MANAGEMENT
Subject
Name
Institution
Date
, Risk associated with backdoor buying and selling? Why is purchasing interested in
controlling this business practice?
What is maverick buying? is when an employee purchases goods without authorization.
We’re not talking about buying items that have no place being purchased for the business,
like a neon palm tree for their office. We’re also not talking about stealing or embezzling,
what they’re doing is legal it just isn’t in the company’s best interest. Maverick buying is
when an employee purchases goods, parts or materials for a project, going outside of the
accepted buying channels of their organization An example is that some practices may not be
termed as illegal but essentially, Purchasing must act accordingly to control
maverick because it's the biggest, lose value for money because of the
informality of the buying and selling process.
The risks associated with backdoor or maverick buying and selling are :
1. Purchasing policies and procedures will not be followed
2. Higher cost due to different prices from suppliers for same items
3. Inability to achieve efficiency and economy of scale by combining like purchases
across a company.
4. Purchasing is interested in controlling this business practice because it bypasses the
control of purchasing authority.
It results in additional costs unlike if the purchase occurred in a formal agreement where
even the prices are reasonable. There no formalities hence the likelihood of conflicts that
may be difficult to solve. Purchasing must act accordingly to control maverick because
it’s the biggest challenge that can kill the role of purchasing in a company .Further the
company may lose value for money because of the informality of the buying and selling
process.
The Rustler” Type A Maverick Buyer:
Subject
Name
Institution
Date
, Risk associated with backdoor buying and selling? Why is purchasing interested in
controlling this business practice?
What is maverick buying? is when an employee purchases goods without authorization.
We’re not talking about buying items that have no place being purchased for the business,
like a neon palm tree for their office. We’re also not talking about stealing or embezzling,
what they’re doing is legal it just isn’t in the company’s best interest. Maverick buying is
when an employee purchases goods, parts or materials for a project, going outside of the
accepted buying channels of their organization An example is that some practices may not be
termed as illegal but essentially, Purchasing must act accordingly to control
maverick because it's the biggest, lose value for money because of the
informality of the buying and selling process.
The risks associated with backdoor or maverick buying and selling are :
1. Purchasing policies and procedures will not be followed
2. Higher cost due to different prices from suppliers for same items
3. Inability to achieve efficiency and economy of scale by combining like purchases
across a company.
4. Purchasing is interested in controlling this business practice because it bypasses the
control of purchasing authority.
It results in additional costs unlike if the purchase occurred in a formal agreement where
even the prices are reasonable. There no formalities hence the likelihood of conflicts that
may be difficult to solve. Purchasing must act accordingly to control maverick because
it’s the biggest challenge that can kill the role of purchasing in a company .Further the
company may lose value for money because of the informality of the buying and selling
process.
The Rustler” Type A Maverick Buyer:
