Shadowing Practice: What is Procurement? Procurement Process Explained in 12 minutes - Learn English Speaking with Video
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Every product you touch, wear, eat, or use started with a decision.
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Who should we buy it from?
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How much will it cost?
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Will it arrive on time?
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That decision, it's called procurement.
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From a tech startup ordering software to a hospital sourcing life-saving equipment, procurement is the invisible superpower behind every successful business.
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But this isn't just about buying stuff.
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It's about the science and art of getting the right things from the right people
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at the right time and at the right price.
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So, let's dive in.
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First, what is procurement?
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At its core, procurement is the process of sourcing, negotiating, and acquiring goods or services from external suppliers to meet the organization's needs.
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This includes sourcing vendors, negotiating prices, signing contracts, tracking deliveries, ensuring quality, and finally, managing payment.
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Whether it's software for a startup or machines for a factory, procurement decides who delivers what, when, and how much it costs.
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For example, think of procurement like planning a big wedding.
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You don't just go buy food and flowers.
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You plan your guest list, find reliable caterers, compare quotations, ensure everything arrives on time, track the budget, sign contracts.
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That's procurement on a business scale.
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Let's take a real-world example.
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Tata Motors, one of India's largest automobile manufacturers.
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To build each vehicle, they need tires from Bridgestone, steel from Tata Steel, electronics from Bosch,
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paint, seats, dashboards, software systems, etc. Tata Motors doesn't manufacture all of this in-house.
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Instead, they procure parts from a global network of suppliers who specialize in those products.
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If even one part, like a microchip, doesn't arrive on time, production halts, deadlines are missed, and millions are lost.
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That's how powerful procurement is.
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Second, how procurement works.
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Now let's break down how procurement actually works.
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Here's a five-stage framework used by most global organizations.
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Step one, need identification.
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A business unit, say the HR team, needs 100 laptops for new employees.
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They raise a procurement request.
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Step 2, supplier sourcing.
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Procurement researches trusted vendors, Amazon Business, Dell, HP, etc. Step 3, quotation and evaluation.
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They invite bids, compare pricing, delivery, warranty, and customer service.
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Step 4.
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Contract and order.
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They finalize the best deal and place the order with terms locked in.
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Step 5.
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Receive, inspect, and pay.
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Laptops arrive, quality check, payment approved, order archived.
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This structured process helps businesses avoid overpaying, missing deadlines, or dealing with shady suppliers.
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Third, why procurement is so important.
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Procurement isn't just paperwork.
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It's a profit-driving, risk-reducing, strategy-boosting engine.
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Let's look at five reasons why.
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Number one, cost control.
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Procurement controls up to 70% of company expenses.
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Even small savings create big profits.
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Number two, ensures continuity.
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No materials, no production, no services, no sales.
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Procurement ensures that there are no delays in production due to missing materials.
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For example, during COVID-19, smart procurement helped hospitals like ApolloSource PPE kits when others couldn't.
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Number three, maintains quality.
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The right suppliers deliver the right results.
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Number four, reduces risk.
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Procurement teams assess suppliers for financial stability, reliability, and compliance.
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For example, airlines like Indigo build relationships with multiple fuel vendors to reduce over-dependence.
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Number five, boosts reputation.
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Ethical and green procurement builds public trust.
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For example, Starbucks supports small farmers and sustainable coffee sources through ethical procurement partnerships.
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Fourth, types of procurement.
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Procurement isn't one size fits all.
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There are four primary types depending on what you're buying.
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Number one, direct procurement, procurement of good services used directly in production.
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For example, a car company buying engines, seats, and tires.
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Number two, indirect procurement, supporting materials not part of the end product, but necessary to run the business.
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For example, office furniture, marketing software, security services.
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Number three, services procurement.
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External professionals hired for a project.
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For example, a company hiring a marketing agency or freelance graphic designer.
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Number four, strategic sustainable procurement.
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Sourcing focused on long-term value, environmental impact, and social or ethical benefits.
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For example, IKEA using FSC-certified wood from verified suppliers.
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Comparison table.
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Fifth, the procurement process.
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Let's go deeper.
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Here's the full 10-step procurement cycle used by large businesses globally.
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First, need identification.
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A department identifies what's required.
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Second, authorization management checks and approves the request.
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Third, market research, shortlist suppliers from directories or platforms.
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Fourth, RFQ or RFP creation, request for quote for simple needs or proposal for complex services.
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Fifth, evaluation of quotes, analyze pricing, terms, delivery.
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Sixth, negotiation, finalize favorable terms.
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7. Contract finalization.
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Sign a formal agreement.
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8. Purchase order.
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Send PO to supplier.
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9. Delivery and inspection.
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Receive goods and check for quality.
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10. Invoice and payment.
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Pay after verification and archive records.
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Efficient organizations automate this flow with procurement software like SAP Ariba or Coupa to reduce errors and increase transparency.
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If you're watching and finding these procurement process helpful so far, make sure to like the video, share it with others who might benefit,
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and subscribe for more breakdowns on business, tech, and management.
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So, quick check-in for you.
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Have you ever been responsible for purchasing something important for your workplace or project?
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What would you look for in a supplier?
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Price, speed, quality?
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Drop your answers in the comments.
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We want to hear from you.
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Sixth, procurement versus purchasing.
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Now let's clear up a huge myth.
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Procurement is not just a fancy word for purchasing.
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Let's make the difference crystal clear.
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Scope.
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Procurement is a broad strategic process while purchasing is a narrow transactional activity.
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Focus.
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Procurement emphasizes value creation, risk mitigation, and supplier relationships, whereas purchasing is focused on buying goods and services.
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Process stage, procurement starts before and ends after purchasing, while purchasing starts with the order and ends with payment.
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Activities included, procurement involves sourcing, supplier evaluation, contracting, and compliance,
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while purchasing includes ordering, receiving, and paying.
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Timeframe.
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Procurement has a long-term focus, while purchasing involves short-term actions.
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Tools used.
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Procurement utilizes RFPs, supplier scorecards, and ERP systems, while purchasing uses purchase orders and invoices.
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People involved.
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Procurement engages cross-functional teams.
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Legal, finance, strategy.
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While purchasing typically involves the procurement-slash-purchasing department.
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Decision criteria.
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Procurement considers the total cost of ownership, risk, and innovation potential, while purchasing focuses on the lowest price and fastest delivery.
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Examples.
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Procurement might involve sourcing ethical coffee for one year, while purchasing could be buying coffee filters for this week.
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So remember, procurement is the strategy, purchasing is the action.
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Both matter, but procurement builds long-term value.
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Seventh, real-world procurement examples.
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Let's look at how big names across different industries use procurement to power their operations.
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Healthcare Apollo Hospitals procures medicine, equipment, patient food, staff uniforms, cleaning services, even ambulance fuel.
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Procurement ensures 24-7 availability of medical supplies.
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Equipment is sterile and certified.
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Staff have the tools they need.
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Aviation Indigo Airlines procures fuel contracts, airplane parts, catering services, ground staff equipment.
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Without procurement, flights are delayed, passengers are stranded, business loses millions.
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Construction L&T procures raw materials, steel, cement, software for 3D modeling, contracts with labor and transport vendors.
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TechZoho procures servers, cybersecurity vendors, cloud services, ad agencies, all coordinated globally.
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E-commerce, Misho, or Amazon procures packaging, warehousing, third-party delivery services, cloud storage,
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customer care services, food chains, Domino's Pizza, procures cheese, flour, packaging boxes, scooters for delivery, uniforms.
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Procurement ensures you get your pizza hot, fresh, and on time, every time.
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Every industry, from manufacturing to education, depends on efficient procurement.
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Eighth, challenges in procurement.
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Procurement isn't always smooth sailing.
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It's powerful, but it's not without its challenges.
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Common procurement challenges, internal fraud or unethical supplier practices, global supply chain disruptions, currency fluctuations,
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lack of transparency or poor record keeping, political instability in supplier countries, pressure to be cost effective without compromising quality.
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To overcome these, companies must invest in skilled procurement professionals and tech-driven procurement systems.
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Ninth, tech and trends in procurement.
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Modern procurement is being transformed by tech.
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Tech tools used in procurement.
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ERP systems, like SAP Oracle, integrates procurement with finance and logistics.
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E-procurement platforms, automate purchase orders and approvals.
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AI and predictive analytics, demand forecasting, and supplier evaluation.
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Blockchain ensures transparency and fraud prevention.
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Sustainable procurement systems choose suppliers that follow ethical, eco-friendly practices.
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Global supplier diversification.
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Post-COVID, companies are moving from just-in-time to just-in-case supply chains.
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Trend alert.
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More businesses are adopting green procurement, preferring vendors who are eco-conscious, ethical, and socially responsible.
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Tenth, roles and careers in procurement.
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Thinking of a career in procurement?
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If you enjoy negotiating, analyzing data, and working with people globally, procurement could be your dream career.
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The demand is booming.
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Popular job titles, procurement analyst, strategic sourcing manager, supply chain coordinator, vendor manager, procurement director.
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Skills you need communication, negotiation, financial literacy, supplier relationship management, legal knowledge, tech savviness, Excel,
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SAP, e-procurement tools, industries, hiring, FMCG, pharma, tech, retail, manufacturing, and government.
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Every sector needs strong procurement minds.
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So the next time you see finished product, from a car to a coffee machine, remember the invisible chain that made it possible.
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Procurement.
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But wait, we're not done just yet.
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To test your understanding of everything you've learned today, head over to our website, Thinkaduka.com, and take a quick,
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interactive, multiple choice quiz on this topic.
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Thank you for watching, and remember, smart procurement builds smarter businesses.
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And check out our next video on supply chain management.
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It's directly connected to procurement.
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Click here to watch it next.
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Vocabulary and speaking notes for this lesson
This video has 175 sentences and 1564 words to shadow. The speech runs for 12:39. The speaker talks at a steady 124 words per minute, a comfortable pace for shadowing. Only 68% of the words are among the 3,000 most common in English, so the vocabulary is demanding.
Key vocabulary in this video
15 words from the video worth learning, with pronunciation and meaning:
| Word | Pronunciation | Meaning |
|---|---|---|
| procurement noun | /pɹəˈkjʊəɹ.mənt/ | The purchasing department of a company. |
| supplier noun | /səˈplaɪə/ | One who supplies; a provider. |
| vendor noun | /ˈvɛn.dɚ/ | A person or a company that vends or sells. |
| ethical adjective | /ˈɛθɪkəl/ | Of or relating to the study of ethics. |
| arrive verb | /əˈɹaɪv/ | To reach; to get to a certain place. |
| involve verb | /ɪnˈvɑlv/ | To have (something) as a component or a related part; to comprise, to include. |
| evaluation noun | /ɪˌvæljuˈeɪʃn̩/ | An assessment, such as an annual personnel performance review used as the basis for a salary increase or bonus, or a summary of a particular situation. |
| strategic adjective | /stɹəˈti.dʒɪk/ | Of or pertaining to strategy. |
| hire verb | /ˈhaɪɹ/ | To obtain the services of in return for fixed payment. |
| sustainable adjective | /səˈsteɪnəbəl/ | Able to be sustained. |
| negotiate verb | /nəˈɡəʊ.ʃi.eɪt/ | To confer with others in order to come to terms or reach an agreement. |
| transparency noun | /tɹænsˈpæɹənsi/ | The quality of being transparent. |
| globally adverb | /ˈɡloʊbəli/ | In all places or situations. |
| cloud noun | /ˈklaʊ̯d/ | A visible mass of water droplets suspended in the air. |
| package noun | /ˈpæk.ɪd͡ʒ/ | Something which is packed, a parcel, a box, an envelope. |
Phrasal verbs you will hear
| Word | Pronunciation | Meaning |
|---|---|---|
| break down verb | To stop functioning. | |
| check out verb | To record the departure or withdrawal of someone or something (such as guests, employees, books, etc.). | |
| clear up verb | /klɪəˈɹʌp/ | To clarify, to correct a misconception. |
Pronunciation to watch
The speaker uses 12 contractions and reduced forms, such as isn't, doesn't, you're. Say them the short way, as you hear them.
- The “th” sounds: ethical /ˈɛθɪkəl/, sixth /sɪksθ/, smooth /smuːð/, seventh /ˈsɛvənθ/, eighth /eɪtθ/
- The “sh” and “zh” sounds: evaluation /ɪˌvæljuˈeɪʃn̩/, negotiate /nəˈɡəʊ.ʃi.eɪt/, efficient /ɪˈfɪʃənt/, identification /aɪˌdɛn(t)ɪfɪˈkeɪʃn̩/, negotiation /nɪˌɡəʊ.ʃiˈeɪ.ʃən/
- Long words — get the stress right: evaluation /ɪˌvæljuˈeɪʃn̩/, sustainable /səˈsteɪnəbəl/, negotiate /nəˈɡəʊ.ʃi.eɪt/, transparency /tɹænsˈpæɹənsi/, identification /aɪˌdɛn(t)ɪfɪˈkeɪʃn̩/
How to practise with this video
- Listen to the whole video once without speaking and note the words you do not know.
- Shadow it sentence by sentence at normal speed, repeating each one until your rhythm matches the speaker.
- Record yourself and compare with the original, paying attention to words like procurement, supplier, vendor.
דקדוק בסרטון הזה
המבנים שהדובר משתמש בהם הכי הרבה, עם המילים המדויקות מהסרטון:
| מבנה | בסרטון |
|---|---|
| סביל (Passive voice) be + past participle — הדגש הוא על מה שקורה, לא על מי שעושה את הפעולה | are missed · are delayed · be cost |
| הווה מושלם (Present perfect) have/has + past participle — פעולה שקרתה בעבר ועדיין יש לה חשיבות או השפעה עכשיו | Have you ever been · you've learned |
מהי טכניקת השאדואינג?
שאדואינג היא טכניקת למידת שפה מבוססת מדע שפותחה במקור להכשרת מתורגמנים מקצועיים ופופולרית על ידי הפוליגלוט ד"ר אלכסנדר ארגואלס. השיטה פשוטה אך עוצמתית: אתה מקשיב לאודיו באנגלית ילידית וחוזר עליו בקול רם מיד — כמו צל העוקב אחרי הדובר עם עיכוב של 1–2 שניות בלבד. בניגוד להאזנה פסיבית או תרגילי דקדוק, שאדואינג מכריח את המוח והשרירים בפה לעבד ולשחזר דפוסי דיבור אמיתיים בו זמנית. מחקרים מראים שזה משפר משמעותית את דיוק ההגייה, האינטונציה, הקצב, הדיבור המחובר, הבנת השמיעה ושטף הדיבור — מה שהופך אותו לאחת השיטות היעילות ביותר להכנה לIELTS Speaking ולתקשורת באנגלית בעולם האמיתי.