How to Become a Purchasing Manager (So Much More Than Just Buying Stuff)
March 15, 2021
Without purchasing managers, nothing would get manufactured, and nothing could be sold. That's because these supply-chain professionals have a hand in everything from production to logistics to distribution.
Purchasing managers are the unsung heroes of the supply chain. Without them, there would be no raw materials with which to produce goods and no finished products on retail shelves. It is their job to make smart, economical purchasing decisions to support an organization's operation and production.
Do purchasing managers exist to make a profit? Absolutely, but they also serve a vital function throughout the product life cycle. The best purchasing managers can find deals on component parts, predict what types of products will be popular, and leverage networks to acquire all the resources it takes to make and distribute the food, clothing, household goods, medicines, and energy we consume every day.
Manufacturers, wholesalers, retailers, and the federal government most frequently employ purchasing managers, but purchasing managers also work in e-commerce, technology, food and beverage companies, and engineering firms. The role used to be relatively straightforward: the purchasing manager was simply in charge of contracting and placing orders with suppliers when supplies were needed. Today, the role of purchasing manager is a strategic one, and the professionals in it are expected to play a crucial part in optimizing the supply chain. In other words, purchasing managers spend a lot more time solving puzzles than signing off on invoices—and they get paid pretty well for it.
Want to know more? In this article about how to become a purchasing manager, we cover:
- What does a purchasing manager do?
- Do purchasing managers and procurement managers do the same job?
- What skills do you need to be a purchasing manager?
- What education do you need to be a purchasing manager?
- How do you become a certified purchasing manager?
- How much does a purchasing manager earn in a year?
- What does the advancement path for purchasing managers look like?
- What are the prospects for a career as a purchasing manager?
What does a purchasing manager do?
Purchasing managers are the supply-chain professionals responsible for managing purchasing officers, buyers, and other employees involved in purchasing raw materials used in production and/or wholesale and retail goods for resale. They monitor what's needed when, approve procurement requests, and in some cases, are responsible for creating a strong procurement strategy. Their goal is to find and buy the best possible raw materials, component parts, and finished products for the lowest possible price. This can involve a lot of research and a lot of contract negotiation, and usually requires a deep understanding of the purchasing process.
The responsibilities of purchasing managers typically include:
- Overseeing the work of the purchasing department
- Training purchasing agents, buyers, and other staff members
- Monitoring inventory levels
- Forecasting upcoming demand
- Negotiating technical specifications for raw materials, components, equipment, or products
- Prioritizing stock orders and timing deliveries
- Identifying new suppliers
- Negotiating vendor contracts
- Tracking supplier deliveries
- Assessing wholesale and retail purchasing agreements
- Monitoring pricing with a company's long-term financial success in mind
- Processing payments and invoices
- Monitoring market trends
- Collaborating with retail buyers and other purchasing professionals
- Working closely with the director of purchasing to develop effective procurement strategies
As one Quora commenter put it, procurement "is a very cross-functional role. For example, you will work with legal on contracts, finance on payment terms and repatriation opportunities, manufacturing on site-level requirements, etc."
Purchasing managers work just about everywhere. You find them in the purchasing department of retail companies, manufacturing companies making everything from electronic components to farm products, research and science labs, and distribution centers. Any company that deals in finished goods or raw materials needs purchasing agents and a procurement manager to oversee them. At larger companies, a procurement manager might have an assistant purchasing manager and lead a large team of buyers. A purchasing manager at a smaller company might handle procurement themselves.
Do purchasing managers and procurement managers do the same job?
The term 'purchasing manager' is usually used as an umbrella title that can include wholesale merchandising managers, retail trade merchandising managers, and procurement managers. However, some people feel strongly that purchasing managers and procurement managers do very different things. It's worth trying to understand where they are coming from.
Some purchasing professionals believe that the term 'purchasing' applies to transactions that occur in retail and resale environments, while 'procurement' applies to transactions happening in a production environment. In this view, purchasing managers oversee a lot more sourcing and have to be aware of the needs of end customers.
Other purchasing professionals look at procurement as the overarching end-to-end process of acquiring products. Procurement begins with the identification of needs and ends when a contract with a vendor is consummated. Purchasing, in that view, refers to the actual process of reaching out to vendors and contracting with them.
At the end of the day, however, employers ultimately determine whether purchasing managers and procurement managers do the same job. One commenter on a now-defunct thread on LinkedIn put it this way: "I appreciate everyone's attempt to make something out of nothing. After four decades with material acquisition responsibility, I have found the difference between procurement and purchasing is solely the word preference of the management team. What is the difference between a purchasing agent and a procurement agent? I say nada, zip, none, zero."
What skills do you need to become a purchasing manager?
The most essential skills you need to have to become a purchasing manager involve purchasing, finance, data analytics, and supply management. Those aren't the only competencies that lead to success in this field, however. You'll also need the following:
- Relationship management is hugely important in both public procurement and private procurement. Having a rapport with suppliers is critical at every cycle of product development, manufacturing, and distribution and can lead to discounts.
- Industry-specific knowledge is vital for purchasing managers in some fields because ordering the wrong component or the wrong materials can lead to financial losses in the best-case scenario and deadly workplace accidents in the worst-case scenario.
- Negotiating skills are a must-have because the purchasing department needs professionals capable of getting the best supplies and products at the best prices. This can involve negotiating costs, delivery schedules, and specs with suppliers.
- Interpersonal skills are important because sometimes things go wrong in procurement, and it is the purchasing manager's job to fix whatever problems arise. Working with suppliers to resolve issues can involve listening and diplomacy.
- Networking skills are necessary because a big part of this job consists in finding and reaching out to new suppliers. A purchasing manager's network can be an invaluable source when it comes to finding retail and production partners.
- Data analytics chops aren't strictly required to succeed in this role, but they can definitely make it easier to shine. That's because supply chains are growing increasingly intricate and may involve suppliers from around the world. Understanding the impact changes will make can sometimes require crunching a lot of numbers.
What education do you need to become a purchasing manager?
This isn't an entry-level position, and while purchasing managers do come from various educational backgrounds, they all have significant work experience in purchasing and supply management. About 10 percent of purchasing managers are hired with an associate's degree—often a supply-chain degree. About 45 percent of all purchasing managers have bachelor's degrees, and 24 percent have master's degrees. What's especially surprising is that, at least according to Salary.com's data, 19 percent of purchasing managers have worked their way up in the purchasing department with nothing more than a high school degree.
Don't let those numbers fool you into thinking you can land this job without completing a bachelor's degree program. True, there is no single path to becoming a purchasing manager. Even so, a quick glance at job listings for this role will tell you that employers are generally looking for candidates with business, supply chain, logistics, engineering, or related degrees. Some also require that candidates have degrees or other qualifications demonstrating technical knowledge related to a particular field, like a bachelor's degree in mechanical engineering.
Purchasing managers often have one of the following bachelor's degrees:
- 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
Some employers do require purchasing managers to hold a master's degree. Unfortunately, there are very few degree programs focused on procurement in the US outside of Webster University's MA in Procurement and Acquisition Management. It's possible to get an MBA in Sourcing and Procurement in the UK and in Europe, but if you have to study in the US, look for Master of Science in Supply Chain Management programs, master's in global supply chain management programs, or Supply Chain MBA programs that have classes in subjects like:
- The fundamentals of purchasing
- The procurement process
- Supplier relations
- Budgeting process fundamentals
- Pricing and cost analysis
That said, don't stress too much over the name of your degree. Advancing in procurement often involves on-the-job training and hands-on experience supervised by the director of purchasing or chief procurement officer. The first step is to make sure that the internships you complete during your graduate school years help you get that kind of experience.
How do you become a certified purchasing manager?
Not all employers look for certified purchasing managers, but professional purchasing certifications are worth pursuing if you want to advance in procurement. According to a report published by the Institute for Supply Chain Management, the ideal candidate for this role will have "a number of certifications under her belt."
Certifications for purchasing managers include:
- The Certified Purchasing Professional (CPP) designation
- The Certified Purchasing Professional Manager (CPPM) designation
- The Certified Green Purchasing Professional (CGPP) designation
- The Certified Professional Purchasing Consultant (CPPC) designation
- The Certified Public Procurement Officer designation
Hireability is one good reason to pursue certifications. The fact that you'll make up to 13 percent more than your uncertified peers is another. You should also look into general supply chain management certifications—especially if you think you might want to transition out of procurement into another area of the supply chain someday.
How much does a purchasing manager earn in a year?
The median pay for purchasing managers might be as high as $118,000—or as low as $67,000; it depends on whom you ask. What's clear is that purchasing managers typically make a lot more than purchasing agents and buyers, who usually earn between $56,000 and $59,000 annually. That said, the only way to know for sure how much you'll earn in your industry is to read job listings. Most advertisements include salary information.
The fastest way to boost your income, short of earning additional certifications, may be to tweak your resume to highlight the professional wins you have racked up that are related to the following skills:
- Contract negotiation
- Supplier management
- Supply-chain management and optimization
What does the advancement path for purchasing managers look like?
Because the supply chain is expansive and complex, there are lots of career paths in purchasing. Many purchasing managers start out as purchasing agents, buyers, procurement analysts, or procurement specialists. The next step usually involves becoming an assistant purchasing manager and then advancing to purchasing manager… or supply manager, sourcing manager, director of materials management, category manager, or commodities manager. From there, an experienced purchasing manager might be promoted to VP of procurement, VP of sourcing, director of procurement, or chief procurement officer.
What are the prospects for a career as a purchasing manager?
Jobs in the supply-chain industry are still relatively easy to come by—and that includes jobs in procurement. You might not land a job at Amazon (a company renowned for its supply chain practices) or any of the other big players in retail or manufacturing, because the word has gotten out: there's money to be made in purchasing, and the work is more interesting than most people realize. More people are vying for jobs now, but don't assume that the procurement landscape is saturated with talent. Millions of manufacturing jobs go unfilled each year, and many of those openings are in procurement. Chances are that if you have the right skills and degrees, you won't have any problems at all finding a purchasing manager job.
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