Anomalous Purchase

CIOP is an end-to-end supply chain certification program that focuses on practical aspects in addition to the theoretical concepts. For example, a typical supply chain certification may teach what is cycle counting and how to do the ABC classification. CIOP starts with these fundamental concepts and goes on to teach the participants to develop the cycle counting policy of an organisation, 10+ criteria used in ABC classification, multi-criteria ABC classification and cycle counting best practices to increase the efficiency and effectiveness. In case of CIOP, you learn the concepts and will be ready to implement in your day-to-day job in supply chain. The pedagogy is structured such a way that all the concepts are explained with industry examples, which makes CIOP as the preferred training and certification program for supply chain within the industry.

The term Anomalous Purchase refers to a company's purchase of goods which are not in their control. An example of this is buying raw materials that are in excess of your expected run rate for that month and have run out of that material, or the purchasing of inventory that is obsolete because of the current conditions of the marketplace. 

Many companies have run into this type of issue when it comes to procuring inventory. When an item is bought at a lower price than its run rate, the company must either find a new source for that item or close the deal with another firm.

The main problem with an anomalous purchase is that it occurs at a point in time when the company cannot change its production plans in order to fulfill the order. For example, if you need to buy a hundred units of a certain product at a certain time, you can't change your production plan to make more of that hundred units available at the agreed upon price, so you have no choice but to purchase it at the low price. This causes both parties to incur financial loss because the other party cannot deliver the item as agreed upon, and the company incurs a penalty because the contract was Violated - a fine or monetary loss due to the violation of one of the terms of the contract.

Anomalous purchases are also caused by the failure of a supplier to deliver items on time because of a variety of factors. Many companies have a supplier that is very unreliable because of the poor quality of their products, which means that they are always out of stock and will sell out very soon. Other suppliers run into financial difficulty because of the poor economic conditions. Both parties then suffer because they had to pay the higher price to get the product in stock and also because of the financial loss because of the lack of sales during the period they were out of stock.

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