1 25-04-2015 UN Procurement Procedures. 2 25-04-2015 The Procurement Process Formal procurement method: ITB/RFP Informal procurement method: Shopping/RFQ.

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UN Procurement Procedures

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The Procurement Process

Formal procurement method: ITB/RFP

Informal procurementmethod: Shopping/RFQ

Request for procurementaction

Development of specifications/TOR/SOW

Identification of suppliersMarket research

Strategic analysis/Procurement plan

Selection of procurementmethod

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The Procurement ProcessFormal procurement method: ITB/RFP

‘Shopping’Less than USD2,500

RFQ – Request for Quotation,

Up to USD30,000

Informal

Used for Goods and Services

Identify potential Suppliers

Document 3 Quotatations

Lowest Price Contract approval process

Evaluation

Bid Receipt & Opening

AdvertisementPreparation of formal

solicitation documents

Contract management

Contract award

ITBInvitation to Bid, Over USD30,000

Used for Goods and Civil Works

RFP Request for Proposal,

Over USD30,000

Used for Services(can incl. Goods)

Separate Evaluation

Separate Bid Receipt & Opening Tech &

Fin

AdvertisementPreparation of formal

solicitation documents

Contract management

Contract approval process

Contract award

Lowest Priced Compliant

BidderBest Scored bidder

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The Procurement ProcessFormal procurement method: ITB/RFP

‘Shopping’Less than USD2,500

RFQ – Request for Quotation,

Up to USD30,000

Informal

Used for Goods and Services

Identify potential Suppliers

Document 3 Quotatations

Lowest Price Contract approval process

Evaluation

Bid Receipt & Opening

AdvertisementPreparation of formalsolicitation documents

Contract management

Contract award

ITBInvitation to Bid, Over USD30,000

Used for Goods and Civil Works

RFP Request for Proposal,

Over USD30,000

Used for Services(can incl. Goods)

Separate Evaluation

Separate Bid Receipt & Opening Tech &

Fin

AdvertisementPreparation of formalsolicitation documents

Contract management

Contract approval process

Contract award

Lowest Priced Compliant

BidderBest scored bidder

Prequalification

Post Qualification/Pre-shipment

Inspection

Expression of Interest

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Additional processes

• Expression of Interest

Used as part of market researchIdentifying and prequalifying suppliers

Keep abreast with new developmentsDoes not necessarily result in procurement

• PrequalificationCan form part of ITB/RFP

Used for high-risk goods such as pharmaceuticals, condoms

Used for where high impact if delivery fails, such as elections

Confirming manufacturing, quality standards, other issues i.e. child labor

Very specialised for pharmaceuticals

• Post Qualification/Preshipment Inspection Used as part of testing pre-contract stageEnsuring equipment works under special conditions

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Samples of EOI

Agency website, UNPDAgency website, UNDP

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Application:• Used for formal competitive bidding when requirements cannot be

described in a definite or complete manner, i.e. when a technical or other solution is sought (TOR).

• Normally used for procurement of works and services. Two-envelope system (technical and financial proposal).

Important:• Evaluation Criteria must be part of RFP.

Award of contract:• Select proposal that offers the best value in accordance with

evaluation criteria.

Request for Proposal (RFP)

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RFP Process Illustrated

• Based on actual case• Procument of Services results in RFP method• Project for Guard Security Service for UN offices in Pakistan• UNDP Pakistan country office requested UNDP/IAPSO in Copenhagen

to undertake procurement on their behalf• Security service also for other UN Agencies in Pakistan• Case illustrates:

EOI Pre-bidding meetingDetailed Tender DocumentationExamples of Evaluation Criteria related to ServicesExamples of OutcomesRFP resulting in Direct ContractingAnd another unexpected turn in events . . .

• Confidentiality . . . Names and documentation

• NB: RFP can also be done for goods, e.g. part of complete solution, or where there could be alternative or varied goods to meet the same need

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EOIReasonSupply market analysisNeeded to comply with UN Security Council requirementsPreqaulification

Published on IAPSO websiteand in local media

Outcome19 EOIs Received8 Companies shortlisted

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RFPRFPParticipation only for short listed suppliers in this case

Why? Control of process . . . Required 3 compliant bids

If no prequalification, all welcome to participate

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What to look out for

• Allow to bid on sections or only total requirements

• Pre-bidding meeting

• Clarifications and AmendmentsCommunicated to allSuggesting alternativesAdvise on short delivery times

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Pre-bid meeting

• CVs for staff

• Suggestions by suppliers

• Letters rule• Detailed evaluation

method not disclosed

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Pre-bid meetings and visits

• Open to suggestions• In UN’s interest to have compliant bids

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Details• Language

• Checklist of documents

• Use the correct format!!

• Impressions and facts

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Policies and Standards

• Quality Standards vary• Supplier Code of

Conduct

• NB:No pricing informationNumberingProprietary InfoConfidentiality

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More Details

• Quote in requested currency

• Note: Letter overrule figures

• SignaturesCopies

• Payment terms not negiotable

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Deadlines

• No exceptions!• Time difference• Envelopes

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Opening and Evaluation

• Committee

• Errors

• Non-responsive bidsLateUnsignedIncompleteWrong format

• Tech & Fin Proposals

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Formula

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Actual Score sheet

• Ranking

Company A Company B

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Details of Evaluation

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Actual document and Evaluations

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Actual evaluation comments

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Technical Evaluation Outcome

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Contract

• Cancel processPoor processLack of fundsChange of needs

• Flexibility and patience required

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Performance Security and Payment

• Bank guarantees/performance security• Payment terms not negotiable • 30 days after delivery• Could be staggered depending on services/goods

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The form

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Performance

• Crucial• Share information

via UNGM• Vendor eligibility

policies

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Price Schedule

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Financial Proposal’s Opening

Company A

Company B

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Financial Proposal

Company A Company B

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Internal Review of Procurement Process

• For all processes over USD30,000

• Between 30,000 – 300,000 Local approval

• Over USD300,000 approval at HQ level

• Thresholds vary

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Headquarter Review

• Review:ProcessValue For MoneyQuality AssuranceDocumentation

Outcome:• Queried number, qualification and supervision of guards• Seeked report on performance of Company A (existing

supplier)• Concerned about limited competition

and requested outcome of evaluation results

• Performance report shows issues with supplier ...• Meeting with supplier to address issues• Rewarded for 6 months period and measures and stringent

arrangements put in place to monitor

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How the ITB Process Differ?

• Used for goods and works where specific quantities are available.

• Simplified process, comparison simpleInstructions to bidders includes:• Incoterms 2000• Delivery dates FCA and FOB• Freight arrangements• After-sales service• Training • Spare parts• Deviations from specifications• Country of origin information and developing

countries

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Supplier qualifications

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Evaluation Criteria

• Compliance with GTAC

• Supplier Criteria• Technical Specs• Price and Delivery

Time

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Price schedule

• Do NOT change format

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Deviations

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Practical Tips

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Practical Tips for Potential Vendors

Research UN agencies and traditional items/services required

Marketing your goods and servicesLook for EOIPost/e-mail informationEnglish on websiteStart where you are doing business

Register on www.ungm.orgE-mail addressCorrect codingKey wordsUp to dateRespond to reminders

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Practical Tips for Potential Vendors

Finding opportunitiesUNGM – Tender Alert ServiceAgencies’ websites

Always respond

Pay attention to:Deadlines, timezonesFormatLanguageCurrencyAddressing of envelopes

Seek clarification

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Practical Tips for Potential Vendors

Attend Bid Openings or ask Embassy/Consulate

Prepare to meet new challengesKits, training materials, after-sales serviceAwareness of environmental concerns

Be patient and perservere