Save Money with a Purchasing Policy

Do you have rules for purchasing items? Whether it's our personal finance or business finance following specific purchasing rules will save you money and find better services.

A good purchasing policy assist you find the best value for your money - notice I didn't say the cheapest service. I found, in most cases, basing decisions solely on price will cost you money in the end. By best value for your money, I mean looking for services that best fits your needs.

My wife (Ester) and I are moving to a new home so I've set up services with many new vendors.

My purchasing policy has two simple rules:

1. Get three price quotes for each item or service - For new services, I call at least three to five vendors to interview them. For items, a little research online or a quick trip to a few stores should do
2. Wait at least 24 hours on any purchase over $100 - Quick, on the spot decisions will cause many errors and wasted money. Many services will attempt to offer a deal if you sign up right away. I combat this sales technique upfront by telling the sales representative that I will not make a decision today and that all special offers need be valid for 24 hours.

Okay, now that you created a simple purchasing rules to live by, it's time to interview the vendors. The interview will help you decide on the best vendor. Here's some tips for interviewing.

• Write down questions in advance - To get a fair comparison, ask all the vendors the same questions.
• Take notes -After you interview a few vendors, the interviews start to blend together. Taking notes separates all of the conversations.
• "Is there any question that I should have asked but did not?" - This is one of my favorite questions. Since you are not likely to be an expert in the field that you are researching, this question prompts the sales representative talk about what defines them from the competition, gives you good questions to ask the next vendor candidate, and lets you know important information that you may have missed. For example, when I called some propane companies for my new home heating, I found asking this question that not all propane companies will service our tank if it leaks.

Through this interview process, I find many surprising deals. In the case of finding a Propane company for our new home, one vendor originally installed the underground tanks and delivered to most of our development, therefore offering special rates. I also got the best feeling from what the sales representative said. With prices 72 cents cheaper per gallon, we will save $720 per year on the average 1000 gallons that we will purchase.