Procurement terminology can make everyday conversations feel more complicated than they need to be. One minute you’re discussing a supplier, the next someone mentions “TCO”, “SRM”, “RFQ” and “maverick spend” like it’s completely normal.
If you’ve ever wondered what procurement terms actually mean, you’re not alone. This guide breaks down key definitions in plain English, so you can follow meetings with confidence, understand documents faster and communicate more clearly with stakeholders across the business.
Common procurement acronyms you’ll hear all the time
| Acronym | What it stands for |
|---|---|
| RFQ | Request for Quotation |
| RFP | Request for Proposal |
| RFI | Request for Information |
| ITT | Invitation to Tender |
| SLA | Service Level Agreement |
| KPI | Key Performance Indicator |
| P2P | Procure-to-Pay |
| TCO | Total Cost of Ownership |
Common Procurement Terminology (explained)
Incoterms
Incoterms (International Commercial Terms) are recognised rules by the ICC that define the responsibilities, costs and risks of buyers and sellers in international trade.
Maverick spend
Purchases made outside the approved procurement process, often linked to spend leakage.
Benchmarking
Comparing supplier pricing, performance or service levels against the wider market or peer organisations.
Contract lifecycle management (CLM)
Managing contracts from creation and approval through to renewal, expiry or termination.
Why procurement terminology matters
Procurement terms are not just buzzwords. Understanding procurement terminology helps you communicate more clearly, interpret documents faster, make better commercial decisions and reduce risk.
Ready to turn terminology into practical skills?
Understanding procurement terms is useful, but the real value comes from applying them confidently in day to day work. If you’d like to strengthen your capability in areas like negotiation, category management, stakeholder influence, or sustainable supply chains, our procurement short courses are designed to be practical, focused and immediately useful.