Material procurement

Procurement is a term describing the purchasing process for goods and services. In building construction, material procurement is the process by which the materials required to construct a building are selected, ordered, invoiced, paid for and delivered to the site.

A procurement team, or one or more construction buyers may be responsible for procurement activities for products, materials, plant and subcontractors. They typically work for the main contractor(although sub-contractors may also have buyers on large projects) to ensure that supplies are provided in accordance with the project programme, specification and budget. For more information see: Construction buyer

Materials will typically be ordered from the supply chain, often from external suppliers with whom the team may have had past successful dealings, or who may be specified in the contract documents.

Procuring materials is a crucial aspect of the construction process as contractors will normally be inundated with requests from suppliers for the provision of goods and services. They must therefore order materials that align with both the client’s and contractor’s objectives.

Developing the most suitable purchasing strategy will involve selecting material suppliers according to a range of criteria that are likely to include speed of delivery, cost, quality, specific project constraints, risk, asset ownership and financing.

Within a specification, buyers may have flexibility in purchasing, particularly where an architect or engineer has specified a product and added the clause ‘…or equal approved’, upon which the buyers may – for good reason – substitute a different product that must, as a minimum, meet the same standards as the original.

Where a specification stipulates only one type or brand of material/product available from one supplier, the procurement team may be bound to procure that product even though it may consider that there are better equivalent offers on the market.

[edit] Competitive bidding

Suppliers of goods may be selected from a list of registered suppliers of the product/material to be purchased. Selection may be on the basis of a competitive tender, where selected suppliers must submit their most competitive price for the item in question. In some cases, a supplier may be specified on the basis of criteria such as product patent and/or uniqueness of offer.

[edit] Sustainability

In recent years, sustainability has assumed growing importance in the procurement of construction materials, particularly as they are the largest single category of waste going to landfill, and the industry is one of the largest producers of CO2 emissions. Local councils, clients and contractors may influence procurement by, for example, stipulating a minimum percentage of recycled materials must be used.

Whether in the specification or not, procurement teams will usually endeavour to source the most environmentally friendly options combined with value for money. This is particularly important in the light of the 2006 definition of sustainable procurement by the Sustainable Procurement Task Force: ‘A process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole-life basis in terms of generating benefits not only to the organisation, but also to society and the economy, while minimising damage to the environment.’