why is purchasing becoming increasingly involved in the purc

why is purchasing becoming increasingly involved in the purchase of transportation services and other nontraditional purchasing areas?

Solution

Due to the legislation passed during the 70`s and 80`s desregulated the air, trucking and railroad industries. This legislation allowed buyers to negotiate service agreements and rate discounts directly with transportation carriers.

Previosly the US government through the Interstate Commerce commision established the rate referred as a tariff.

Purchasing department are involved with transportation buying management of inbound and outbound material flow and now the purchasing department evalutes and chooses the logistics provider that fits best for their needs. Purchasing department have more than 1 carrier depending on the lanes they cover and how fast the need to receive material or to send material, they are in constant communication with the carrier and looking for daily updates.

If there is a delay on the service, purchasing department will request a reduction on what the carrier is charing the organization.