Procurement Process in the Aviation Industry


Procurement Process in the Aviation Industry

The procurement process in the aviation industry is similar to the procurement process in other major industries. It begins with the requisitioning process which is communicated to the supplier using a purchase order (PO). There are several ways to identify supply needs. Initial provisioning using the recommended spare parts list (RSPL) or the initial provisioning list (IP) is common for preparing a purchase request. The RSPL is a list of recommended spare parts that manufacturers of airplanes recommend; the IP is a similar list but only includes critical spares according to operational requirements. Companies may also have need-based demands which is when a spare part is needed and out of stock. A company may need to procure an item for replenishment action, which is the act of re-stocking low-cost parts when they reach a certain level. The needs identified are communicated to the purchasing department and they create a purchase request (PR), where delivery is scheduled, quality parameters are defined, and the request is authorized or rejected.

The second phase is the quote process. The purchasing department submits a request for quote (RFQ) to various suppliers. The quote includes information on the valid period of the offer, quantity price breaks, taxes, charges, discounts, delivery terms, and delivery details. The purchaser will then compare quotes from different suppliers and select the best option that meets their needs. The supplier selection is different in the aviation industry because the same item may be procured in different conditions or may have different approvals such as new, new surplus (NS), serviceable (SV), overhaul (OH), etc. The various conditions are analyzed along with cost and approvals before they are authorized and used to create a PO.

There are five major aviation part types: rotables, repairables, spares, consumables or expendables, and tools. Consumables or expendables may be obtained using a Blanket Purchase Order (BPO) while the other part types may be purchased using a regular PO. The PO may be created by referencing the PR or quote, or the information may be inputted manually. A BPO is a long-term contract used by companies to ensure that they are maintaining a consistent supply of items that are constantly being used; a release order (RO) or release slip (RS) is necessary for such a long-term contract. ROs include the contract number, quantity required, delivery date, and the warehouse to which the supply will be delivered.

The final stages are goods receipt and invoice matching. The goods receipt is provided by the supplier and includes all the pertinent details of the goods delivered. The purchaser will then verify that the goods receipt matches what they ordered; and when the goods are received, it can be used to inspect them and can be taken into the inventory stock. Invoice matching compares the quantity and value of goods at various stages in the procurement process. Two-way matching is used when a goods receipt does not need to be prepared; it matches the invoiced quantity and value with the ordered quantity and value. Three-way matching matches the invoice with the receipt of goods and is used when inspection of goods is not required.

At ASAP Aviation Procurement, owned and operated by ASAP Semiconductor, we can help you find all the rotables and aviation parts you need, new or obsolete. As a premier supplier of parts for the aerospace, civil aviation, and defense industries, we’re always available and ready to help you find all the parts and equipment you need, 24/7x365. For a quick and competitive quote, email us at sales@asap-aviationprocurement.com or call us at +1-702-919-1616.


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