Factors influencing purchasing cost in procurement system: the case of Public Institutions in Tanzania

Most of public procurement system is characterized by frequently emergency orders, poor documentation of records, poor purchasing procedures, lack of consolidated purchase and lack of effective communication between the management and procurement sections in government institutions. The main objective of this study was to determine factors influencing purchasing in procurement system. The cross sectional study survey was conducted in Dar es Salaam region and involved different procurement officers from government institutions. Primary and secondary data were obtained through structured questionnaires and different publications. The study was designed to use multiple regression model developed by researcher. The purpose of developing this model was to obtain the weight and have different ranks according to the perceptions and opinions of those who filled the questionnaires. Findings show that there is a relationship between the costs associated with lack of effective communication and purchasing cost. Similarly the study found direct relationship between costs associated with poor documentation and purchasing cost. Costs associated with lack of consolidated purchase have also direct relationship with purchasing cost. Furthermore, purchasing costs is also directly related to costs associated with emergency or rush orders. Lastly, costs associated with poor purchasing procedures have direct relationship with purchasing cost. Based on the findings, the study recommends that the government should continue with the efforts to enforce procurement laws and train all government staffs to avoid interference among government staffs. The governments should also implement and train procurement staffs on procurement planning in order to reduce rush order to reduce rush orders and frequency purchase. There is a need also for the government to enforce proper communication between user departments and procurement department in government institutions.