Organizing purchasing as a cost center means that the department would generate sufficient profits to cover expenses.

Question

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Organizing purchasing as a cost center means that its primary focus is to control and reduce costs, rather than generating profits. The department aims to achieve cost-effectiveness by negotiating favorable deals with suppliers, optimizing costs of goods and services, and reducing waste and inefficiencies. Any savings or cost reductions realized by the purchasing department would contribute to the overall profitability of the organization, but the department itself is not expected to generate profits.

Organizing Purchasing as a Cost Center Means That the Department