Dictionary of Procurement Terms

1. Cost advantages achieved by businesses when demand increases and production becomes more efficient. This occurs when businesses lower unit costs by increasing the cumulated production volume, as set production costs are spread over a large number of units produced. 2. An increase in the quantity ordered that results in a reduction in selling price. See also: Quantity Discount, Volume Discount, Volume Leveraging.

A measure of the quality of an output; helps determine the degree of customer satisfaction. (Business 2002)

Ability to successfully engage in an activity or task with minimal use of resources (e.g., time, effort, materials, capital).

The integration of electronic data interchange, electronic funds transfer, and similar techniques into a comprehensive electronicbased system of procurement functions; can include posting Invitations for Bids (IFBs) and Requests for Proposals (RFPs) on electronic bulletin boards, the receipt of bids via electronic data interchange, the notification of awards by email, and payment via electronic funds transfer. Also referred to as Electronic Sourcing (eSourcing).