UN Procurement Procedures

The Procurement Process Formal procurement method: ITB/RFP Informal procurement method: Shopping/RFQ Request for procurement action Development of specifications/TOR/SOW Identification of suppliers Market research Strategic analysis/ Procurement plan Selection of procurement method

The Procurement Process Formal 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 Advertisement Preparation of formal solicitation documents Contract management Contract award ITB Invitation 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 Advertisement Preparation of formal solicitation documents Contract management Contract approval process Contract award Lowest Priced Compliant Bidder Best Scored bidder

The Procurement Process Formal 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 ITB Invitation 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 Bidder Best scored bidder Prequalification Post Qualification/ Pre-shipment Inspection Expression of Interest

Additional processes Expression of Interest Used as part of market research Identifying and prequalifying suppliers Keep abreast with new developments Does not necessarily result in procurement Prequalification Can 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 stage Ensuring equipment works under special conditions

Samples of EOI Agency website, UNPD Agency website, UNDP

8 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)

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 meeting Detailed Tender Documentation Examples of Evaluation Criteria related to Services Examples of Outcomes RFP resulting in Direct Contracting And 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

EOI Reason Supply market analysis Needed to comply with UN Security Council requirements Preqaulification Published on IAPSO website and in local media Outcome 19 EOIs Received 8 Companies shortlisted

RFP Participation only for short listed suppliers in this case Why? Control of process... Required 3 compliant bids If no prequalification, all welcome to participate

What to look out for Allow to bid on sections or only total requirements Pre-bidding meeting Clarifications and Amendments Communicated to all Suggesting alternatives Advise on short delivery times

Pre-bid meeting CVs for staff Suggestions by suppliers Letters rule Detailed evaluation method not disclosed

Pre-bid meetings and visits Open to suggestions In UN’s interest to have compliant bids

Details Language Checklist of documents Use the correct format!! Impressions and facts

Policies and Standards Quality Standards vary Supplier Code of Conduct NB: No pricing information Numbering Proprietary Info Confidentiality

More Details Quote in requested currency Note: Letter overrule figures Signatures Copies Payment terms not negiotable

Deadlines No exceptions! Time difference Envelopes

Opening and Evaluation Committee Errors Non-responsive bids Late Unsigned Incomplete Wrong format Tech & Fin Proposals

Formula

Actual Score sheet Ranking Company A Company B

Details of Evaluation

Actual document and Evaluations

Actual evaluation comments

Technical Evaluation Outcome

Contract Cancel process Poor process Lack of funds Change of needs Flexibility and patience required

Performance Security and Payment Bank guarantees/performance security Payment terms not negotiable 30 days after delivery Could be staggered depending on services/goods Page 31

The form

Performance Crucial Share information via UNGM Vendor eligibility policies Page 24

Price Schedule Page 27

Financial Proposal’s Opening Company A Company B

Financial Proposal Company ACompany B

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

Headquarter Review Review: Process Value For Money Quality Assurance Documentation 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

How the ITB Process Differ? Used for goods and works where specific quantities are available. Simplified process, comparison simple Instructions 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

Supplier qualifications

Evaluation Criteria Compliance with GTAC Supplier Criteria Technical Specs Price and Delivery Time

Price schedule Do NOT change format

Deviations

Practical Tips

Practical Tips for Potential Vendors  Research UN agencies and traditional items/services required  Marketing your goods and services Look for EOI Post/ information English on website Start where you are doing business  Register on address Correct coding Key words Up to date Respond to reminderswww.ungm.org

Practical Tips for Potential Vendors  Finding opportunities UNGM – Tender Alert Service Agencies’ websites  Always respond  Pay attention to: Deadlines, timezones Format Language Currency Addressing of envelopes  Seek clarification

Practical Tips for Potential Vendors  Attend Bid Openings or ask Embassy/Consulate  Prepare to meet new challenges Kits, training materials, after-sales service Awareness of environmental concerns  Be patient and perservere