Procurement

"Procurement is defined as the buying of goods and services that enable an organisation to operate its supply chains, in a profitable and ethical manner. There are many different interpretations of what procurement is, and this definition can vary from sector to sector " subject to the activities undertaken within organisation. The Chartered Institute of Procurement & Supply (CIPS)

In relation to the design and construction of buildings, procurement also relates to the process of purchasing goods or services often related to a building. In terms of the building itself, as a whole there are many different routes by which the design and construction of a building can be procured, the selection of which should follow a strategy which fits the long-term objectives of the client's business plan. The term procurement route refers to the method by which a building itself is procured impacted by considerations of speed, cost, quality, specific project constraints, risk, asset ownership, financing and so fourth.,.

The National Construction Contracts and Law Report 2018, published by NBS, suggested the following mix of procurement routes in the construction industry: Traditional procurement, Design and build, Partnering / alliancing, Construction management, Contractor approved without any tender process, Measured term, PFI / PPP, Cost plus, and Management contracting.

More generally The Chartered Institute of Procurement & Supply (CIPS) refers to different types of procurement methods, to which the above construction specific route would most likely fall, such as

"Open tendering: This method ensures all interested suppliers have an equal opportunity to bid for the contract in question. It promotes competition and fairness, but can be time-consuming and labour intensive as you’ll need to evaluate the bids as they come in.

Request for proposals: This method is an open request, whereby the organisation asks suppliers to bid for the contract. The organisation would need to describe what they need to fulfil and the expected timeline of the completion of the work.

Two stage tendering: This method is split into two stages. The first stage has complete information without prices from the suppliers, and the second stage includes the price specification from the suppliers. The supplier with the highest ranked bid is then invited to stage two, where they’ll submit financial proposal.

Request for quotations This procurement method is non-competitive, as you’ll choose the suppliers to request quotation from. You’ll typically pick at least three suppliers to submit quotes, and pick the best one based on the requirements you’re after.

Selective tendering With this procurement method, suppliers can only submit tenders by invitation. The competition is confined to a number of suppliers who are pre-betted based on their track record.

Single source tendering This method is typically used under exceptional circumstances. For example, if only one supplier is qualified, goods or services only available from a specific source or in emergencies."

To find out more se the article procurement route and to find out more about CIPS visit hhttps://www.cips.org/

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