• On the basis of the final cost estimate, a job cost is generated using the proper cost codes for all categories of material, equipment and labor.
• The project manger identifies the products necessary to meet the contract specifications per the approved submittals and submits a material request form accordingly.
• The accounting department inputs all the information against the specific job and assigns purchase order number to the request. The material request is then forwarded to the purchase assistant.
• The purchase assistant checks the availability of the material with local vendors and after negotiating for “best price,” he releases the order to the vendor. All shipping and delivery information is forwarded to the site superintendent to facilitate in making the necessary arrangements for receipt and storage of materials at the site.
• An updated job cost report is printed every fortnight. The project manger is provided with a copy of the report to assist in verifying the amount spent against the budget and keep a running total and avoid cost over runs.

Scheduling material procurement to avoid negative impact on the project schedule is the key function of the purchasing department. Since all purchase orders are made at the start-up of the project, delays are avoided with a majority of products ordered. For prefabricated manufacturing items, the purchasing department routinely tracks the progress of the delivery to head-off any potential delays due to holiday seasons, etc. At the selection stage, the purchasing department additionally makes alternative product selections so that a proprietary specification will not affect the construction schedule. If there are any major delays noted by the manufacturer before the start of fabrication of the equipment, the purchasing department will request a “change of product: and upon approval release a new order. “Fabricate and deliver” is a line activity shown on SCM’s “CPM” schedule and is a line activity for all key installations.