Definition of Procurement – Procurement vs Purchasing

Purchase to Pay, P2P and Dynamic Discounting

Define procurement

The terms “Purchasing” and “Procurement” are often used, incorrectly, interchangeably. So what is the difference between purchasing and procurement? What does procurement entail and what exactly does purchasing mean.

Procurement Definition

To define procurement broadly, “Procurement” is the overarching function that describes the activities and processes to acquire goods and services. Importantly, and distinct from “purchasing”, procurement involves the activities involved in establishing fundamental requirements, sourcing activities such as market research and vendor evaluation and negotiation of contracts. It can also include the purchasing activities required to order and receive goods

For details on the Procurement process see The Procurement Process.


The term “Purchasing” refers to the process of ordering and receiving goods and services. It is a subset of the wider procurement process. Generally, purchasing refers to the process involved in ordering goods such as request, approval, creation of a purchase order record (a Purchase Order or P.O.) and the receipting of goods.

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