What Is Procurement

What Is Procurement? Meaning, Process, Jobs And Pay

What procurement means, how it differs from purchasing, what the jobs pay, and how the field is studied.

By the Supply Chain Degree Programs editorial team Updated
A man in an orange T-shirt holding a clipboard and checking labeled rolls of colored vinyl on a rack in a stockroom
Median Pay, Buyers And Purchasing Agents
$77,710
BLS wage survey, May 2025
Median Pay, Purchasing Managers
$148,080
BLS wage survey, May 2025
Openings A Year Across Both Occupations
53,600
BLS projections, 2025-35

What Is Procurement?

What is procurement? Put simply, it is how an organization gets the goods and services it needs from outside suppliers. It starts before anything is bought, when someone works out what is needed, and it ends after delivery, when the contract is closed and the supplier paid. In between sit the parts most people picture: finding suppliers, comparing offers, negotiating and signing.

The most exact definition in US law is the federal government’s, which calls it acquisition. The Federal Acquisition Regulation says acquisition “begins at the point when agency needs are established and includes the description of requirements to satisfy agency needs, solicitation and selection of sources, award of contracts, contract financing, contract performance, contract administration, and those technical and management functions directly related to the process of fulfilling agency needs by contract.” Companies use different words for the same cycle, but the stages are the ones that sentence lists.

Procurement is one part of a supply chain: the part that deals with suppliers. Moving and storing what was bought is logistics, and the guide to supply chain management shows how the pieces fit together.

Procurement vs. Purchasing

The two words are often used as if they meant the same thing, and in day-to-day speech they nearly do. The useful distinction is one of scope. Purchasing is the transaction: raising the order, receiving the goods, paying the invoice. Procurement takes in the whole cycle around it, including the work before the order (defining the need, choosing the supplier, negotiating the terms) and after it (managing the contract and the supplier’s performance).

Job titles don’t respect the line. O*NET, the Labor Department’s occupation database, files procurement and contracting administrator, procurement and contracting buyer and procurement official under the same occupation as purchasing administrator and purchasing agent, and BLS counts them all together as buyers and purchasing agents. So for a career, the word in the title tells you little; the duties in the posting tell you how much of the cycle the job covers.

The Procurement Process, Stage By Stage

The stages below are the ones the federal definition names, in its order. A small company might run them in an afternoon over email; a government agency buying a building runs each one under its own rules. The shape is the same.

The procurement stages named in the Federal Acquisition Regulation, with what happens at each
Stage What Happens
Agency needs are established Someone in the organization needs a product or service it does not have.
Description of requirements The need is written down as a specification: what, how many, by when, to what standard.
Solicitation and selection of sources Suppliers are asked to bid or quote, and the offers are compared on price, quality and reliability.
Award of contracts The terms are negotiated and a contract or purchase order goes to the chosen supplier.
Contract financing Payment terms are set, including any advance or progress payments.
Contract performance The supplier delivers, and the goods or work are checked against the specification.
Contract administration Changes, disputes, invoices and the supplier’s record are handled until the contract closes.

Stages: Federal Acquisition Regulation 2.101, definition of acquisition (FAC 2026-01). The descriptions are this site’s.

Purchasing, in the narrow sense, is the award and the payment. The stages on either side are where most of a procurement team’s time goes, and where the money is saved or lost: a vague requirement or a weak supplier choice can’t be fixed by a good price on the order.

Direct And Indirect Procurement

Procurement is usually split by what is being bought. Direct procurement buys what goes into the product a company sells: the steel for a car maker, the fabric for a clothing brand. Indirect procurement buys everything that keeps the organization running: software, office space, travel, cleaning, consultants. Direct buying sits close to production planning and inventory, so it is where procurement and the rest of the supply chain meet most often.

Public procurement is its own branch. Government buyers work under written rules such as the FAR, with formal bids and published awards, and government accounts for 13% of buyers’ jobs, according to the Occupational Outlook Handbook.

What Procurement Work Looks Like

O*NET ranks the tasks in each occupation by how important workers say they are. The top three for the two procurement occupations show the split between doing the buying and running it:

O*NET's three most important tasks for the two occupations
Occupation Most Important Tasks, Per O*NET
Buyers
  1. Monitor and follow applicable laws and regulations.
  2. Purchase the highest quality merchandise at the lowest possible price and in correct amounts.
  3. Formulate policies and procedures for bid proposals and procurement of goods and services.
Purchasing managers
  1. Develop and implement purchasing and contract management instructions, policies, and procedures.
  2. Locate vendors of materials, equipment or supplies, and interview them to determine product availability and terms of sales.
  3. Prepare bid awards requiring board approval.

Buyers carry out the cycle for individual purchases: the requisitions, the bids, the orders, and the rules that apply to them. Managers set the policy the buyers follow, pick the suppliers that matter most, and sign off on the largest awards.

Procurement Job Titles And Where BLS Counts Them

Postings use a long list of titles for the same few jobs. BLS sorts them into occupations, and the occupation is what its pay and outlook figures describe:

Job titles O*NET lists under each of the two procurement occupations
Occupation Titles O*NET Lists Under It
Buyers Buyer, Contract Administrator, Procurement and Contracting Administrator, Procurement and Contracting Buyer, Procurement Official, Procurement Specialist and Purchasing Administrator
Purchasing managers Category Purchasing Manager, Commodity Manager, Materials Director, Materials Manager, Procurement Director, Procurement Manager and Purchasing Director

O*NET OnLine sample titles, 13-1023.00 and 11-3061.00.

7 of the 9 titles O*NET lists for purchasing agents use one of the two words. The management titles add the newer vocabulary: category purchasing manager, commodity manager and strategic sourcing director. Category and sourcing roles are procurement jobs under another name.

Procurement Jobs And What They Pay

BLS publishes wages for occupations rather than job titles. Two of them cover procurement: buyers and purchasing agents, who do the buying, and purchasing managers, who run it.

Median pay, hourly median and jobs for the two occupations
Occupation Median Pay Hourly Median Jobs
Buyers $77,710 $37.36 491,430
Purchasing managers $148,080 $71.19 84,320

BLS wage survey, May 2025, national. “Buyers” is BLS’s broad buyers and purchasing agents occupation, which takes in the wholesale, retail and farm-products buyers too.

There are far more buyers than managers, which shapes the career: most people in procurement spend years as buyers, and the management jobs are filled from among them. The procurement specialist guide and the purchasing manager guide cover each job in depth.

The Pay Range, From Entry Level To The Top

A median hides the spread. Nine in ten workers in an occupation earn more than its 10th percentile, and one in ten earns more than its 90th:

10th, 25th, 75th and 90th percentile annual pay for the two occupations
Occupation 10th 25th 75th 90th
Buyers $48,380 $60,800 $100,820 $128,870
Purchasing managers $92,490 $115,550 $182,270 $223,280

Same survey, national annual wages.

The step up is large. The top tenth of buyers ($128,870) still earn less than the median purchasing manager ($148,080), so the management move, not seniority as a buyer, is where procurement pay jumps.

Where The Procurement Jobs Are

These five states employ the most buyers, 36% of the national total between them:

Buyer jobs and median pay in the five states with the most of them
State Buyers And Agents Median Pay
California 48,010 $82,720
Texas 44,030 $76,050
New York 31,240 $79,460
Florida 30,270 $72,850
Virginia 22,120 $89,210

Same survey, state estimates.

For managers the leaders are Texas, California and New York. The procurement specialist salary page has every state, and the state rankings list the supply chain programs in each.

Who Hires Procurement Staff

Every organization that buys things needs buyers, but some need far more than others. The Occupational Outlook Handbook breaks down where buyers worked in 2025:

Share of buyer jobs in each of the largest employing sectors
Sector Share Of Buyers
Manufacturing 22%
Wholesale trade 14%
Government, excluding state and local education and hospitals 13%
Management of companies and enterprises 8%
Retail trade 7%

BLS Occupational Outlook Handbook, Work Environment. Shares of the occupation’s jobs.

Manufacturing leads because direct procurement lives there. For managers the largest sectors are manufacturing at 23% and management of companies and enterprises, the head offices of larger companies, at 18%.

Job Outlook And Openings Each Year

BLS projects employment for each occupation over 2025-35, against 3.5% growth for all occupations. Openings count every job that needs filling each year, including the ones people leave or retire from, so they run well above the growth alone:

Projected growth, new jobs and openings a year for the two occupations
Occupation Growth New Jobs Openings A Year
Buyers +6% 30,800 47,200
Purchasing managers +4% 3,500 6,400

BLS projections, 2025-35.

Most of the openings come from replacing people rather than from new jobs. BLS expects buyers’ share of jobs to rise “as supply chains become more complex and additional service contracts are needed.” The is supply chain a good career? guide sets these figures beside the other supply chain occupations.

What It Takes To Get Into Procurement

For buyers, BLS lists a bachelor's degree as the typical entry education, with moderate-term on-the-job training once hired, and 65% of the purchasing agents O*NET surveyed said a new hire needs a bachelor’s. Purchasing managers need the degree too (53% of managers surveyed said so), plus 5 years or more of related work experience: the management job is reached from the buyer’s desk.

Entry education, work experience and training BLS lists for each occupation
Occupation Typical Entry Education Work Experience Training On The Job
Buyers Bachelor's degree None Moderate-term on-the-job training
Purchasing managers Bachelor's degree 5 years or more None

BLS projections, Table 1.2, 2025-35.

Where Procurement Is Taught

Procurement is taught as part of supply chain management rather than as a degree of its own. The federal classification of college programs files it under CIP 52.0203, Logistics, Materials, and Supply Chain Management, and lists acquisitions and purchasing first among the subjects those programs cover; its example program names include Acquisition Logistics and Supply Management.

The program names bear that out. Of the 355 supply chain programs AACSB and ACBSP list in this site’s A to Z directory, 1 mentions procurement or purchasing in its name. Of the 206 bachelor’s and master’s programs this site read on each school’s own page, only 1 does, as a concentration: The University of North Carolina at Greensboro. Everywhere else, sourcing, negotiation and contracts are courses inside the supply chain major.

So a student who wants procurement should look at supply chain degrees and read the course list. The bachelor’s ranking and the master’s ranking list every program here; the online degrees ranking covers the ones you can finish from home.

The Procurement Certification: CPSM

After the degree and a few years of work, the procurement credential is ISM’s CPSM, which covers procurement and supply management: sourcing, category management, cost and price management, negotiation, contracts, supplier relationships, risk and compliance. BLS lists no certification for entry into these occupations, so it is a choice rather than a requirement.

The CPSM exams, eligibility, cost and upkeep, as ISM states them
Who It Is ForSupply chain and procurement professionals whose primary job is supply management, procurement or supply chain. ISM counts only that kind of full-time professional experience toward the award.
The ExamsThree exams. They can be taken before the experience requirement is met, and each passing score stays valid for four years from the test date.
EligibilityThree years of full-time professional supply management experience with a regionally accredited bachelor’s degree, or five years without a degree. Clerical and support roles do not count toward the experience.
CostISM puts the average total cost at $1,485 to $4,277 for members and $2,385 to $5,942 for nonmembers.
Keeping ItValid for three years, then renewed with proof of continuing education.

ISM, CPSM page, read 2026-09-23.

The CPSM guide covers the three exams, and the certifications guide compares it with ASCM’s three credentials.

FAQ

What Is Procurement In Business?

The function that buys what a business needs from outside suppliers, from raw materials to software, and manages those suppliers. In a manufacturer it sits close to production planning; in an office business it mostly buys services.

What Does Procurement Mean In Simple Words?

Getting an organization the goods and services it needs from outside suppliers: working out what is needed, finding and choosing a supplier, agreeing the contract, and making sure it is delivered and paid for.

What Is The Difference Between Procurement And Purchasing?

Purchasing is the buying itself: the order and the payment. Procurement is the whole cycle around it, from defining the need and choosing a supplier to managing the contract afterwards. In job titles the two words are used for the same work.

What Does A Procurement Job Pay?

BLS reports a median of $77,710 for buyers and $148,080 for purchasing managers (May 2025).

Do You Need A Degree To Work In Procurement?

BLS lists a bachelor's degree as the typical entry education for buyers. 65% of the purchasing agents O*NET surveyed said a new hire needs one. Purchasing managers usually also need 5 years or more of related experience.

Can You Major In Procurement?

Rarely under that name. Of the 355 accredited supply chain programs in this site’s directory, 1 names procurement or purchasing. It is taught inside supply chain management degrees, where the federal program definition lists acquisitions and purchasing first.

What Certification Do Procurement Professionals Get?

The best-known is ISM’s CPSM (Certified Professional in Supply Management). It asks for professional supply management experience, so it comes after the first job rather than before it.

Sources

  1. 1 Federal Acquisition Regulation, 2.101 Definitions (“Acquisition”), FAC 2026-01 Read .
  2. 2 NCES, CIP 2020: 52.0203 Logistics, Materials, and Supply Chain Management Read .
  3. 3 O*NET OnLine, 11-3061.00 Purchasing Managers Read .
  4. 4 O*NET OnLine, 13-1023.00 Purchasing Agents, Except Wholesale, Retail, and Farm Products Read .
  5. 5 BLS OEWS, May 2025: Buyers and Purchasing Agents (SOC 13-1020) Read .
  6. 6 BLS OEWS, May 2025: Purchasing Managers (SOC 11-3061) Read .
  7. 7 BLS Employment Projections, National Employment Matrix, 2025-35 Read .
  8. 8 BLS Employment Projections, Table 1.2 (education and training for entry), 2025-35 Read .
  9. 9 BLS Employment Projections, Table 1.12 (factors affecting occupational utilization), 2025-35 Read .
  10. 10 BLS Occupational Outlook Handbook, Purchasing Managers, Buyers, and Purchasing Agents Read .
  11. 11 AACSB, accredited supply chain programs Read .
  12. 12 ACBSP, accredited programs
  13. 13 Each program’s own page, for its official name and formats Bachelor’s read 2026-09-22, master’s 2026-09-22.
  14. 14 ISM, CPSM (Certified Professional in Supply Management) Read .

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