Terry CampbellProject Manager - Procurement
What is Procurement?
Process that considers the acquiring of goods, services, or works from the basic identification of a need, considering different methods of delivery including make or buy options, seeking of suitable providers, defining the requirement, method of financing, and the eventual disposal of the asset or termination of the contract.
Objectives for today:
To indicate how the public sectors tendering processes & regulations workTo advise how to complete tender documentationTo identify tendering opportunitiesTo improve fit to supplyTo increase your chances of winning public tendersTo advise how tenders are evaluatedTo advise how the process may change (modernisation) To provide a chance for networking
The Buyers objectives:To find better sources of supplyTo increase competitionTo overcome shortagesTo try and ensure that the supply base is reflective of local communityTo understand vendors issues To review and improve the tender process
What the public sector buys:AdvertisingAgency StaffBooksBuilding CleaningCatering & Catering SuppliesComputer ConsumablesComputer EquipmentConsultancyCopiersElectricityFurnitureGas Grounds maintenanceInsuranceIT InfrastructureJanitorial SuppliesMechanical and Electrical maintenanceOilParking ServicesSignageStationeryStreet LightingTelecommunicationsVehiclesWaste disposalWaterWater CoolersWindow Cleaning
Local Government Needs to develop an appropriate mix of large contracts, delivering economies of scale, and, where possible, small contracts giving opportunities to local businesses.
To help inform mix, the Council needs to understand spend profile, and have undertaken an impact analysisThis involves:Identifying suppliersIdentifying spend per supplierIdentifying supplier turnoverCalculating spend as a percentage of turnoverClassifying suppliers according to types (SME, BME, local etc)Identifying whether suppliers are e-enabled?Identifying number and category of staff employed by supplierAssessing likely impact of procurement approach
Why is public sector procurement different?
Councils and other public sector bodies spend billions of public funds. 150 billion was spent in 2007 by the whole of the public sector -OGC Subject to UK legislation competition law, Best Value etcSubject to EU legislation aimed to remove barriers in the EU single marketSubject to auditAccountable to government and the electorateMany services are sensitive or high profile
Mertons spend some key findings Non pay Spend of about 162m identifiedSpent on 5760 suppliers76% (c 123.4 m) is spent with just 260 suppliersBut 1,000 or less per year is spent on 2864 suppliers
Top Ten Categories
16.48Social Community CareSocial Community CareSocial Community CareSocial Community CareSocial Community Care
12.8Financial ServicesFinancial ServicesFinancial ServicesFinancial ServicesFinancial Services
11.98Human ResourcesHuman ResourcesHuman ResourcesHuman ResourcesHuman Resources
5.94Environmental ServicesEnvironmental ServicesEnvironmental ServicesEnvironmental ServicesEnvironmental Services
5.18Facilities ManagementFacilities ManagementFacilities ManagementFacilities ManagementFacilities Management
Top Ten Category Spend
ConstructionSocial Community CareFinancial ServicesHuman ResourcesConsultancyEnvironmental ServicesTransportFacilities ManagementICTUtilities
Top Ten Category Spend
So what do we do?Strategic approach: Enhanced procurement strategySustainable procurement Data analysisAnnual high profile Meet the BuyerDeveloping workshops for all sectorsAccess to information via Councils websiteWorking in partnership with business support agenciesSupplier and Contract Management SystemVoluntary Sector Directory
The contract value determines whether we need to seek quotations:Less than 10,000- A single TenderLess than 75,000-Three written quotesGreater than 75,000-Tender exerciseGreater than139,893-EU tender exercise
Procurement Process ExplainedEU Procurement RulesTreaty of Rome principles free trade for member statesOpen and fair competitionService and Supplies contracts with a value above 139,893Works above 3.497 millionMust be advertised in the Official Journal for the European Union
Tender AdvertisementWhere?AlitoLocal and national pressTrade journalsEuropean Journal (OJEU)What?Contract titleDescription / Project briefSpecial circumstancesEstimated valueClosing dateContact detailsEvaluation criteria
Procurement Rules ExplainedTwo main types of tender procedure used:Open Procedure open to any supplierRestricted Procedure initial Pre-Qualification Questionnaire used to shortlist suppliers to be invited to tender
Pre-qualification ProcessTo provide information and documents that demonstrate:Technical capabilityFinancial stability and commercial understandingPast performance as demonstrated by referencesCommitment to equal opportunitiesCommitment to health and safetyCommitment to sustainable environment
Exercise Question 1Good answer?
QuestionPlease outline how your company proposes to manage quality during this contract.
AnswerDedicated Account Manager whose sole purpose is to ensure that 100% satisfaction is achieved
Suggested Answer Question 1Product QualityInternal quality checking procedure including quality checks at critical times throughout the process Quality management systems in place to record, analyse and resolve problemsService QualityMonitoring of KPI and reporting with MIUndertake user surveys and then use this to ensure continuous improvement
Exercise Question 2Good answer?QuestionPlease detail safety arrangements for the delivery of goods/works/services, specifically including:Risk assessment proceduresFirst aid provisionEmergency proceduresAnswer All of the above are incorporated within our Health & Safety Policy
Suggested Answer - Question 2Answer the questions, when it asks for detail, you need to respond with detail. Your submission can only be evaluated on your response.
Risk Assessment ProcedureEmployees are required to..
First Aid ProvisionAt least one member.
Exercise Question 3Good answer?QuestionPlease give examples of how your environmental policy is applied in practice.Answer We have worked for 6 years delivering this service for Merton Council and have always considered environmental concerns
Suggested Answer Question 3
Where a question asks for examples give examples. Also do not assume prior knowledge. The only information which can be considered is what is written down. What any of the evaluation panel know about your organisation from previous working arrangements cannot be considered.
E.g. Our policy states our commitment to reduction in emissions due to travelling so we have installed secure bicycle racks and shower facilities, we also actively encourage use of public transport and car sharing for business purposes.
Top TipsRead documentation carefullyProvide all the information requestedOnly include information requestedSign, date and return all required documents by the deadlineCross-reference additional informationFollow pricing structure, be clear and accurateDont make assumptions ask for guidanceAnswer the questions fullyBe honest!
About AlitoWeb based systemSupports electronic tendering, supplier & contract management functionalityIncorporates approved listsAny organisation can registerNo fees for suppliersCollaborative projects
How does Merton use Alito
All procurement in excess of 10,000 profiled on AltioEach opportunity is assigned one or more categoriesSuppliers registered against these categories are alerted to relevant opportunitiesEmail generated to the primary contactResponsibility of primary contact to follow-upLogin to Alito, download the documentsThe rest is up to you!
Organisational profile on AlitoCreate your company profile:Basic company information e.g. addressCreate users - primary contact key choiceChoose Councils - one or moreSelect categories - as many as possibleComplete any questionnaires - approved listsSubmit your profileImportant - keep it up-to-date
Participating in tenders
Use the bulletin board to search for and locate opportunitiesClick on the tender reference numberNotice Tab Title, description and deadlineRegistration Tab Register to access docsDialogues Raise questions for clarificationAttachments Download the documentationResponses Submit your bid electronically
Be pro-active dont wait for alertsConsider your search parameters when looking for tenders e.g. stage and categoryAllow plenty of time to submit responses dont start five minutes before a deadlineContact the procurement team:Registration issuesTender accessibility problems
Not registeredVisit http://procurement.merton.gov.uk/ read the information and download the guide
Already registeredCheck your profile is up-to-dateConsider the identity of your primary contactAdd Councils and categories where necessary