Supply Chain Management

How Much Do Purchasing Agents Earn?

How Much Do Purchasing Agents Earn?
Purchasing agents have to understand the needs of each point on the supply chain and have a knack for finding reliable merchants who can supply materials, parts, and goods on time and at a fair price. Image from Unsplash
Christa Terry profile
Christa Terry April 27, 2020

Purchasing agents aren't supply chain bigwigs (and salaries reflect that). Even so, this is a role worth looking into because it offers plenty of room for advancement.

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To keep the supply chain humming along, you need supplies. Purchasing agents are the SCM professionals responsible for finding, ordering, and distributing raw materials, component parts, semi-finished goods, products, and equipment for businesses across industries. They are the master networkers of the supply chain.

A big part of what purchasing agents do involves relationship management. They go to trade shows, they make cold calls, and they visit and revisit merchants in their supply networks to find the best possible prices. They’re also problem solvers. When materials and products are defective or the wrong order shows up, they’re the ones who have to fix the issue.

At first glance, it might look like this is a position that wouldn’t require a degree or a lot of specialized skills. The truth, however, is that this is a critical role, and most purchasing agents (who are sometimes called procurement agents or buyers) have undergraduate degrees and highly-developed business skills. Procurement isn’t just about finding the cheapest suppliers and ordering from them, after all. Purchasing agents have to understand the needs of each point on the supply chain and have a knack for finding reliable merchants who can supply materials, parts, and goods on time and at a fair price.

There are purchasing agents working in retail companies of all sizes, manufacturing companies across sectors, research and science labs, and distribution centers. They all have similar responsibilities, but they don’t all bring home the same paychecks. How much someone earns in this role depends on their industry, the size of the company they work for, and many other factors that we dig into below.

In this article about the average purchasing agent salary, we cover:

  • What do purchasing agents do?
  • Are buyer and purchasing agent the same role?
  • What education do purchasing agents need?
  • What is the average purchasing agent salary?
  • Does highest level of education affect purchasing agent salaries?
  • Are there certifications that can boost a purchasing agent’s earning potential?
  • Where can purchasing agents earn the most money?
  • How can a purchasing agent earn more money?

What do purchasing agents do?

Purchasing agents are the supply chain professionals who make buying decisions and make purchases for businesses across industries and institutions like hospitals, schools, and government agencies. Not to be confused with wholesale and retail buyers who purchase goods for resale, purchasing agents buy goods or services related to production and operations. This includes everything from the raw materials, component parts, and packaging used to produce goods for consumers to the equipment used to make those goods and the supplies the head office needs to keep running.

This isn’t a management position, however. Procurement can be a challenge because companies have to balance quality against quantity, shipping time against shipping costs, and the high price of inventory overages against the perils of having too little inventory on hand. However, it’s the purchasing managers and the executives who operate above them who are responsible for creating a strong procurement strategy. Purchasing agents take the strategies executives develop and put them into practice in ways that ensure company funds are used wisely. They do this by:

  • Authorizing payments
  • Confirming receipt of orders
  • Evaluating suppliers
  • Finding new suppliers
  • Logging invoices and payments
  • Managing relationships with suppliers
  • Monitoring inventory levels
  • Moving inventory between warehouses
  • Negotiating contracts with suppliers
  • Preparing purchase orders
  • Resolving shipment errors
  • Scheduling deliveries
  • Soliciting bid proposals
  • Submitting orders to suppliers
  • Tracking orders
  • Verifying deliveries
  • Verifying stock

A big part of this job involves staying up-to-date when it comes to market conditions and price trends. Purchasing agents may be responsible for finding the latest pricing information related to specific materials and products, and then approaching existing or new suppliers to make sure a company is getting the best possible prices.

At smaller companies, a purchasing agent might do all the buying, evaluate suppliers, negotiate contracts for all suppliers, and develop a company’s procurement strategy, effectively serving as agent and manager in one. Large corporations might employ an entire purchasing department populated by many agents, each responsible for purchasing one component part, raw material, or type of equipment.

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Are buyer and purchasing agent the same role?

The frustrating answer is ‘sometimes.’ According to Charles Dominick, who wrote about titles on the Next Level Purchasing Association blog, there aren’t standard naming conventions in the procurement discipline. “We tend to use different words to refer to the exact same thing. Think purchasing/procurement/supply management. Or sourcing/competitive bidding/tendering. Or suppliers/vendors/contractors. Or… well, you get the idea.”

Every procurement manager, director of supply chain operations, and hiring manager will have their own ideas about what titles purchasing professionals should be given—and the reality is that they’re all equally valid. Some operate under the assumption that the role of buyer isn’t as broad as that of purchasing agent or is a lower-level position, while others treat these roles as identical.

There are also professionals in SCM who see the title buyer as old-fashioned or unprofessional. In his blog post, Dominick shares an anecdote about one purchasing rep’s response to the company leadership’s decision to use buyer instead of purchaser. “I think the new titles make us sound less professional,” the rep told their director. “‘Buyer’ is a title that someone working at a liquor store would have.”

The takeaway is that—depending on where you apply—you might be hired as a purchasing agent or a buyer… or you may be given an entirely different title. Your annual salary should be about the same regardless of your title. Still, you should be aware that title can have some impact on pay (more on this below). It’s always a good idea to keep your job search parameters broad, so you don’t miss out on any opportunities.

What education do purchasing agents need?

It’s possible to work in this role with an associate’s degree or even a high school diploma, though purchasing agents typically earn some kind of undergraduate degree before they find employment in this field. At the majority of colleges and universities, whether you’re looking at bachelor’s degrees or master’s degrees, purchasing as a discipline is rolled into supply chain management and logistics. Purchasing agents often launch their careers with degrees like:

  • Bachelor of Business Administration
  • BS in Logistics and Supply Chain Management
  • BS in Operations Management
  • BS in Supply Chain Management
  • BS in Business Analytics
  • Bachelor of Business Administration in Supply Chain Management

There doesn’t seem to be any consensus as to whether a supply chain BS or a business degree with a supply chain management focus is the better choice—possibly because these programs are often quite similar. The highly-rated undergraduate supply chain management program offered by the Haslam College of Business at the University of Tennessee – Knoxville, for instance, confers a Bachelor of Science in Business Administration, but students major in SCM.

Most purchasing agents don’t have a master’s degree, and it’s unlikely that employers will expect you to have one if you choose this career. You may be able to advance (and earn more money) faster by going to graduate school, however. Again, there aren’t many degree programs focused on procurement in the US. Webster University‘s MA in Procurement and Acquisition Management is one of the few standalone procurement degrees. If you are committed to the idea of getting a master’s degree, look for Master of Science in Supply Chain Management programs or Supply Chain MBA programs that emphasize purchasing fundamentals, supplier relations, pricing and cost analysis, and the procurement process.

What is the average purchasing agent salary?

There’s very little disagreement among compensation reporting sites about how much purchasing agents earn on average. According to Glassdoor, Indeed, PayScale, and ZipRecruiter, the average purchasing agent salary is about $48,500.

The one outlier is Salary.com, which reports that purchasing agents typically earn about $61,000. There’s no way to conclusively determine which site or sites are publishing the most accurate salary estimates, but it’s telling that the vast majority are in agreement. How much you actually earn in this role, however, will depend on many factors, and, as you’ll see below, there are plenty of ways you can boost your earning potential when you become a purchasing agent.

Does highest level of education affect purchasing agent salaries?

The quick answer is that getting an advanced degree can lead to higher pay in this role. However, the salary boost you might get by going back to school may not be worth the cost of a graduate degree program. Also, your employers’ work experience requirements may matter more than any degree. Salary.com reports that the median salary for a purchasing agent with a bachelor’s degree falls somewhere between $57,642 and $63,022. In comparison, the median salary range for a purchasing agent with a master’s degree or MBA falls somewhere between $58,336 and $63,840. That suggests that earning a degree isn’t the best way to boost your income in this role.

However, a purchasing agent with a master’s degree will have access to additional opportunities. With a Master of Science in Supply Chain Management, you may be able to move into a higher-paying management position (like assistant purchasing manager or procurement manager) or transition into one of the more lucrative roles in supply chain logistics. After working in a mid-level management position, you might even be able to advance into roles like VP of procurement, VP of sourcing, director of procurement, or chief procurement officer.

Even though entry-level salaries in purchasing are relatively low compared to how much other kinds of supply chain professionals earn early in their careers, salaries for top executives in procurement are quite high. The average chief procurement officer salary, for example, is about $290,000. To land that position, you’ll almost certainly need a master’s degree.

Are there certifications that can boost a purchasing agent’s earning potential?

You don’t need professional certifications to work in purchasing, but they’re worth having if your goal is to earn more money in this role. One salary survey found that procurement professionals with certifications earn up to 13 percent more than their uncertified colleagues. Another survey conducted by the Next Level Purchasing Association found that purchasing professionals with the group’s Senior Professional in Supply Management (SPSM) certification (which includes four levels of certifications, earned an average of $20,028 more than those without.

Other certifications for purchasing managers include the:

Where can purchasing agents earn the most money?

The average purchasing agent salary can only tell you so much. Salaries in most industries vary widely by location, and procurement is no exception. Where you work can have a major impact on your earning potential. According to Recruiter, purchasing agents tend to earn the most in the following states:

  • Alaska ($65,610)
  • Connecticut ($64,910)
  • District of Columbia ($83,230)
  • Maryland ($67,810)
  • Massachusetts ($66,080)
  • New Jersey ($67,950)
  • Virginia ($67,300)

Purchasing agents in these states tend to earn the least:

  • Arkansas ($48,210)
  • Mississippi ($47,770)
  • Montana ($47,820)
  • South Dakota ($47,270)

Keep in mind, however, that how much you earn isn’t just about the number on your paycheck. Take Massachusetts, for instance, where the cost of living is quite high compared to the rest of the nation. Your salary in Arkansas may be significantly lower, but your dollar may go significantly further, allowing you to save money or buy a house more easily.

How can a purchasing agent earn more money?

Entry-level purchasing agents are some of the lowest-paid supply chain professionals, with salaries of about $38,000. However, the good news is that there are plenty of ways to increase your earning potential in this role.

Time is one of them. Work hard and you can become a senior purchasing agent earning a $60,000 average base salary or even more. Also, a quarter of respondents on LinkedIn surveys report earning annual bonuses of about $4,500. You could also advance to a purchasing manager or director of procurement position, where you might earn as much as $118,000 per year.

Another way to boost your salary in this role is to switch industries. According to Recruiter and the US Bureau of Labor Statistics, purchasing agents in food services, hospitality, retail, agriculture, and arts and entertainment tend to earn the least. In contrast, those in government jobs, utilities, management positions, manufacturing, and wholesale/retail operations usually make the most. In some cases, transitioning between industries can increase your earning potential by $30,000 or more.

Probably the fastest way to grow your salary is to tweak your resume. PayScale has found that specific skills correspond to increases in income among purchasing agents. You should review your CV to be sure that it highlights your professional wins related to:

  • Contract negotiation
  • Procurement
  • Supplier management
  • Supply-chain management and optimization
  • Vendor relations

Finally, you may be able to make more in this role by changing the search parameters you’re using when you look for new opportunities. As touched on above, companies may give professionals in this role titles like buyer, buying agent, procurement specialist, procurement agent, replenishment specialist, commodity specialist, and many others. It’s worth broadening your job search to include these titles because, in some cases, you’ll earn more. Take purchasing agent versus procurement agent, for example. Whereas purchasing agents earn about $49,000, as we saw above, the average procurement agent salary is about $60,000—even though the job description is the same.

In other words, don’t limit your opportunities for advancement in procurement by title. If you’re qualified to apply for a higher-paying position in the field, go for it. And don’t worry about low entry-level salaries. This role can be a stepping stone that leads to much more lucrative opportunities.

Questions or feedback? Email editor@noodle.com

About the Editor

Tom Meltzer spent over 20 years writing and teaching for The Princeton Review, where he was lead author of the company's popular guide to colleges, before joining Noodle.

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