1. Commodity Profile & Strategy Agreement Title: [insert] Reference: [insert]
For info – delete prior to issue The strategy is used in the planning stage of any procurement to determine how key issues will be addressed e.g. route to market, CSR issues, pricing strategy etc which is then translated into the procurement process and documentation It identifies and minimises risk and assists in ensuring all key factors have been taken into account when conducting the procurement leading to fit for purpose and VFM.

2. Version Control Version Name Date Completed Comments
When drafting and amending the Profile & Commodity Strategy, the Procurement Officer should complete the above table to ensure changes can be tracked and queries can be directed to the appropriate UIG member/others as appropriate

3. Contents
Except where stated as optional the slides contained in this template are the recommended mandatory minimum contents of the Commodity Profile Strategy. Other slides can be added on a commodity specific basis as appropriate . Further slides are contained in the Scottish Public Sector Toolkit
Contents (complete as appropriate)
Slide Number
V10 22/11/2018 Slide 3

4. Mandatory consultation with the Head of Collaborative Procurement (HOPC)
If consultation with HOPC is required detail outcomes here;
For info – delete prior to issue
Procurement Manager must consult with the HOPC in the following circumstances:
where Single Tender Action (non competitive action) is proposed
where a procurement has a strong potential to influence CSR issues
where an extension to a contract or framework agreement is proposed
where the negotiated procedure, competitive dialogue, or dynamic purchasing system is the proposed tendering option
where it is proposed to shorten the EU minimum tendering timeframes or use the Accelerated Restricted procedure (NB use of the Accelerated Restricted MUST be highlighted in the Contract Notice. For further information about the Accelerated Restricted Procedure please refer to this Scottish Procurement Policy Note (SPPN ):
where it is proposed that the duration of a framework agreement will exceed 4 years
where TUPE may apply
V10 22/11/2018 Slide 4

5. Executive Summary Procurement Manager to complete this slide after completion of the Strategy and prior to forwarding for sign off by the UIG/HOPC
Current status: [list]
Spend – total versus addressed: [list]
Scope: [detail]
Strategic recommendations and reasoning: [detail]
Benefits – how much, how, by when?
Price parity opportunities:
- £a achievable by DATE
Benchmarking opportunities:
- £b achievable by DATE
Market competitiveness:
- e.g. new player breaking into the market, driving pricing down but want commitment , £c by DATE
Product standardisation/ rationalisation potential:
- £d, assuming xyz by DATE
Supply chain redesign, moving to ex-works,
- £e by DATE
Any major barriers to success:
V10 22/11/2018 Slide 5

6. UIG Role & Input
Procurement Manager to agree with the UIG their role, responsibilities, input and actions at each stage in the
strategic sourcing process
Agree with the UIG who will agree the final draft of the key stage documentation e.g. all or a nominated number of UIG members re the strategy, award recommendation etc
Agree with the UIG the role UIG members will play in PQQ and tender evaluation and how Tender Evaluation Board scores for PQQ/ITT results will be collated e.g. overall weighted results or the average of score.
V10 22/11/2018 Slide 6

7. Stakeholder (& UIG) Contacts for [Contract/Framework Agreement]
List names and contact details of all stakeholders relevant to this commodity:
Name
Job Title
Division
Contact Tel
V10 22/11/2018 Slide 7

8. Business Need and Functional Requirements
Sector Requirements
Where we are
Where we want to be
What does the commodity do, standard v customised, level of customisation, quality requirements, real v perceived function, service requirements, user perception, value to institution, specific specifications
Consider the procurement innovation issues for highly complex procurements
NB use of generic specifications – if these don’t exist the UIG needs to start working on them as soon as possible
V10 22/11/2018 Slide 8

9. Scope of [Name of Commodity]
Scope the commodity to be covered i.e. what is included in this commodity group, breakdown into sub-commodities, which products fall under which sub-commodity
V10 22/11/2018 Slide 9

10. Expenditure Analysis - Spend Distribution
In scope spend distribution by universities and colleges, supplier, by sub-commodities: [detail]
What is the value of the requirement? How does this inform the procurement process?
Procurement Officer to add an acknowledgement, for future reference, of the source(s) of data used:
V10 22/11/2018 Slide 10

11. Future Expenditure Trends
Demand profile: [insert]
V10 22/11/2018 Slide 11

12. Spend Analysis & Conclusions
Demand profile: [insert]
V10 22/11/2018 Slide 12

13. [Commodity] - Typical Cost Breakdown
Complete the breakdown for the commodity
Profit %
Recommendations
What are the recommendations?
V10 22/11/2018 Slide 13

14. Total Cost Model [Name of Commodity] (Optional)
List the activities carried out under each step of the product life cycle.
Determine the impact of each step on the total cost of ownership in terms of High, Medium or Low.
Brainstorm the cost drivers associated with the activities under each step and determine the opportunities in each area.
Which costs can be reduced (savings)/avoided (cost avoidance)?
Identify Low, Medium and High Savings Opportunities
Identify the barriers and enablers related to realising the opportunities
Raise Need
Acquire / Order
Use
Dispose
Activities:
Impact (on TCO):
Cost Drivers:
Savings Opportunity:
Barriers:
Enablers:
V10 22/11/2018 Slide 14

15. Total Acquisition Cost (OPTIONAL)
Example acquisition costs:
Supplier Costs
Total Acquisition Costs
Organisation’s Costs
Product Driven Costs
Customer Driven Costs
Order
Fulfilment
Costs
Administration Costs
Order
Fulfilment
Costs
Order
Fulfilment
Costs
Order
Fulfilment
Costs
Material
Labour
Overheads
Warehousing
Special tooling
Quality specifications
Defects/rejects/returns
IT Costs
Customer support
Sales
Inventory handling
Transportation
Picking & Packaging
Requisition to P/O
Order Transmission
Expediting
Invoice Reconciliation
Timely Payment
Queries
Reporting
Defects
Inspection
Rejects
Repackaging
Reshipping
Storage costs
Labour
Overheads
Goods receipt
Delivery
Requisitions
Cost Drivers e.g:
Product specification and range
Delivery frequency and location
Order frequency
Order value
Lead time
V10 22/11/2018 Slide 15

16. Supply Market Overview
Market Trends – detail what is happening in the market for the commodity, current and future technologies, changing customer demands, new players, mergers and acquisition
Supply Market Share – detail the key players within the industry, identify size in terms of turnover, sales, number of customers and capacity
NOTE: trends can reveal: who is winning/ losing business, who’s trying to win market share in the UK, whose business objectives match the sector, what do profit margins typically look like for the industry.
V10 22/11/2018 Slide 16

17. Current Contract Position– [Contract/Framework Agreement]
Contract Value
Contract Start/End Dates (plus any extension period (s)
Comments
V10 22/11/2018 Slide 17

18. Current APUC/Sector Suppliers of [Name of Commodity]
Spend
Total Revenue
Background on the Supplier
V10 22/11/2018 Slide 18

19. Main Suppliers in the Market in Context of their Total APUC/Sector Business
APUC/Sector Spend on Commodity
APUC /Sector Total Spend
Other commodities supplied; recent APUC/Sector business awards or losses; other business they are tendering for…etc
V10 22/11/2018 Slide 19

20. Benchmarking Opportunities (Optional)
Look to understand opportunities from: internal APUC price parity I.e. if different Institutions pay different prices and all move to the lowest price point; and, from benchmarking with other organisations e.g. PASA, Value Wales, N Ireland Procurement Service, OGC, Scotland Excel, councils, fire and police service, private sector etc
Product
X Price
Y Price
Notes
V10 22/11/2018 Slide 20

21. Risk Analysis for [Name of Commodity] Inc Barriers To Change
Description of Risk
Probability of Risk
Implications to APUC/Sector
Measures to Minimise / Eradicate Risk
V10 22/11/2018 Slide 21

22. Corporate Social Responsibility (CSR)
Procurement Officer & UIG to consider CSR issues relevant to this procurement:
General issues:
Result of the Risk Coding Analysis for [goods/services] regarding relevance and risk:
Completion of the Sustainable Procurement Risk Assessment Tool (SPRAT) for [goods/services]: Are there any resulting actions are required to be managed. NB: areas may already be adequately covered by the existing CSR questions.
Which areas in PQQ CSR Questionnaire or ITT CSR Questionnaire are required.
Is EAUC assistance required? If ‘Yes’ approach EAUC via the standard letter of engagement.
Specific CSR Requirements for ITT:
V10 22/11/2018 Slide 22

23. CSR -SMEs, Supported Businesses & Social Enterprises and Community Benefits:
Detail barriers to participation for SMEs and proposals for removing:
Can this be let as a Reserved Contract under Regulation 7 of the EU Procurement Regulations:
Identification of any social clauses or community benefits relevant to this procurement:
V10 22/11/2018 Slide 23

24. CSR Race Equality – Impact Assessment
To determine whether race equality is a core requirement in a contract or framework agreement for goods, services or works, the following questions should be considered:
What is to be provided under the contract or framework agreement? [list]
Is the provision of the goods, services, or works one of the functions or policies relevant to meeting the duty to promote race equality? [Yes/No]. Refer to Appendix 3 of the Procurement Manual
Is the provision of the goods, services or works likely to affect (directly or indirectly) the ability to meet the duty to promote race equality? [Yes/No]
Is it necessary to include requirements for promoting race equality in the contract to make sure the duty is met? [Yes/No]
5. What race equality requirements are appropriate for the contract or framework agreement? [list]
If the answer to questions 2, 3, or 4 is ‘Yes’, race equality is a core requirement. Refer to paragraph 3.7 of APUC’s Procurement Manual which details how and where race equality should be implemented into the strategic sourcing process.
V10 22/11/2018 Slide 24

25. Strategic Tendering Options
On the basis of the internal and external analysis, plus opportunity assessment, detail the available options and the pros/cons of each.
Several examples are detailed below:
Option 1: Negotiate and extend current contract
Pros: analysis shows limited opportunity in this area compared with rest of portfolio, would achieve savings whilst minimising resource effort; would also allow APUC to approach the market jointly with PASA next year
Cons: will not optimise savings as suppliers looking for volumes commitments which is dependant on extended work with stakeholders
Option 2: Use OGC framework for next 12mths to allow quick win and gathering of better management information
Pros: initial assessment shows saving of 3% on OGC contract, this could be quickly implemented and allow management information to be collated as currently data is poor
Cons: comparisons with industry suggest savings of 20% if had APUC commitment contract
Option 3: APUC tender and contract for x years, with the aim of being in y position in z period of time e.g. product rationalisation as part of contract requirements. Intention would be dual supply award to maintain competitive tension etc
Pros: Maximise savings
Cons: Resource effort involved given other portfolio opportunities have higher potential
V10 22/11/2018 Slide 25

26. Strategic Tendering Options
Lead-In Period - detail period required: NB: consider the period for implementing the commodity onto PECOS agreed with Supplier eEnablement during the project start up stage
Extension Period: detail proposed period (s):
Tendering route to demonstrate competition: Detail and insert justification
A framework agreement will be established as follows:
Framework route: [single supplier/multi-supplier]
Multi-supplier framework lots: [insert number proposed]
Call off contract mechanism: [direct/ranked/ mini competition]
V10 22/11/2018 Slide 26

27. ITT Considerations (particularly relevant to consider at this stage in more detail when the Open Procedure is proposed so as to reduce the time taken to compile the ITT at the ITT composition stage)
Statement of Requirements (SoR): Detail the main areas and issues needing to be inserted into the SoR
IPR: Does IPR apply and what is the impact.
Access by institutions: detail the number of institutions, affiliated bodies, and if APUC requires to access the contract or framework agreement. Estimate number anticipated to access the contract/framework agreement from commencement date
TUPE: establish if TUPE is likely to apply. If yes, obtain the detail of name(s), sex, employment location of individuals who may be subject to TUPE and consult with the HoP or Human Resources or seek legal advice
Pricing Strategy: detail the how the commodity will be priced (taking into account whole life costing and cost avoidance). Can an e-Auction be utilised for this commodity? State the period of price stability (e.g. 1 year etc) and the reasoning for this.
V10 22/11/2018 Slide 27

28. ITT Considerations
Mechanism for addressing variation in the charges e.g. via RPI/CPI etc: More info can be found at
Payment period: The default position under the Late Payments of Commercial Debts Act 1998 is 30 days
Parent Company Guarantee/bond: state if either is to be included in the ITT for the framework agreement and/or call off contracts or a contract and why use would be beneficial.
Ts&Cs: list any clauses required over and above the standard ts&cs.
For Part B services: If the procurement is considered to be high risk/high value, a standstill period should be considered (with reference to Federal Security Services Ltd vs Police Service of Northern Ireland).
V10 22/11/2018 Slide 28

29. Information re Evaluation of References, Site Visits, and Presentations
In a Restricted procedure, ascertaining an applicant’s past experience in terms of “technical or professional ability” (as determined by Regulation 16(7)(b)(ii) of the Public Contracts (Scotland) Regulations 2006) can be included in a Pre Qualification Questionnaire as a section criteria.  Written evidence of past performance, which can be objectively evaluated, can be used but it is not recommended written evidence is used as a Minimum Standard. Standard forms can be used to request references , but returned references should then be used for information purposes only.The above also applies to an Open procedure.
Site visits:
If a site visit is required before tender return i.e. to be used to inform tenderers more clearly regarding the outputs of the requirement e.g. visit to an Institution's property or visit to a new build, then this is not evaluated.
If a site visit is deemed to be required post tender return and as part of evaluation process (because the information to be ascertained from the site visit directly relates to the subject matter of the Contract or Framework Agreement), this must be detailed as an award criteria in the Contract Notice or ITT, be capable of evaluation, and make clear what is being assessed in the site visit.
Presentations:
If a presentation is deemed to be necessary as part of tender evaluation and/or bid clarification,  it can only be used for information purposes and cannot be detailed as an award criteria in the Contract Notice or ITT and used to evaluate tenders because it is subjective, and not capable of objective evaluation i.e. performance at interview is not an evaluation criteria. 
Evaluation of a presentation’s written output is permissible where as part of bid clarification tenderers are requested to present on common areas in the submitted tenders (which following tender evaluation have been revealed to be areas where clarification would be needed).  These areas cannot be in addition to the award criteria detailed in the Contract Notice or ITT. 
Ensure any area of concern remaining after the presentation is followed up in writing as part of bid clarification.
V10 22/11/2018 Slide 29

30. Refer to PQQ GUIDANCE NOTE
PQQ Selection Criteria Further information OGC Selection/Award criteria PPN
Refer to PQQ GUIDANCE NOTE
Criteria
Selection Criteria
Part A – Background Information
Part B – Economic & Financial Standing
Part C – Conviction of Criminal Offences
Part D – Business Probity
Part E – Technical & Professional Ability
Part A - Section not scored – for info only
Part B - Insert minimum standards in the Contract Notice or list as objective criteria in section III.2 in the Contract Notice .See APUC’s of Financial Analysis of Accounts for recommended levels. NB: if minimum standards are set and aren’t met, the applicant should be excluded from the process
Part C - If the applicant answers ‘Yes’ to any question they MUST be excluded from the process
Part D - If the applicant answers ‘Yes’ to any question they MAY be excluded from the process
Part E - If minimum standards are set and aren’t met, the applicant should be excluded from the process otherwise use objective scoring criteria to shortlist those applicants meeting minimum standards
EXAMPLE
V10 22/11/2018 Slide 30

31. ITT Award & Weighting Criteria
Further information OGC Selection/Award criteria PPN
Award Criteria: award criteria is based on [MEAT/lowest price]
Price Quality Ratio:[insert]
Weighting Criteria:
Minimum Standards (if necessary)
Service Delivery – Detail Requirements
PASS/FAIL
CSR – Detail Requirements
Supplier Stability & Viability – Detail Requirements
EXAMPLE
PQR
Weighting (%)
Award Criteria
Sub-weighting (%)
In this example the headings below are for six award criteria. All questions to be asked of tenderers in the ITT must relate to this criteria and have corresponding weighting. Any sub-criteria and weightings must also be listed. Refer to ITT Schedule 6 for further info.
Price
40% -
100%
Quality
60%
Service Delivery
20%
Design Scenarios
25%
Staffing 5%
Project Planning & Implementation
Warranty & Support
10%
Continuous Improvement
15%
EXAMPLE
V10 22/11/2018 Slide 31

32. ITT Call Off Contract Award Criteria
award criteria is based on [MEAT/lowest price]
Price Quality Ratio:[insert]
Weighting Criteria:
[insert criteria]
[insert weighting]
V10 22/11/2018 Slide 32

33. Contract Implementation – Lead-In Period
Detail what will need to happen, when, and who has responsibility
Communicate with universities and colleges to prepare them for any changes
Conduct product trials (if applicable)
Start running down stocks of current product ranges (if applicable)
Prepare/ complete any required training
Clarify supplier change management/ implementation expectations
Ensure smooth transition
Follow-up on progress
Note requirements for completion later in the strategic sourcing process:
Systems updates, CUPID, SharePoint
Savings notification to individual institution
Notification and award letters
Buyers Guide/ Commodity Action Report (CAR)/ ePS Bulletin etc
V10 22/11/2018 Slide 33

34. ePS Trading Strategy
Detail how End Users will see and access the Framework Agreement content in PECOS:
Use APUC’s Supplier Report showing ePS active suppliers through Institutions & ePS Supplier Report to determine PECOS:
Content Availability
Connection Type
2. Develop a list of specific and general ePS issues / requirements relevant to the commodity: [list]
Plan how these will be accommodated on PECOS: [detail]
Decide PECOS trading strategy:
on catalogue
Catalogue
Punchout
V10 22/11/2018 Slide 34

35. Strategic Contract and Supplier Management
All contracts or framework agreements will be contract managed by the Procurement Officer. Refer to ITT for Procurement Officer and User Group roles and responsibilities. Detail considerations for Contract and Supplier Management
GuidanceScotland strategic contract and supplier management guidance, processes, and templates are available at These are currently being develop and once finalised will be incorporated fully into strategic sourcing documentation.
V10 22/11/2018 Slide 35

36. Timelines
V10 22/11/2018 Slide 36

37. Prior Information Notice (PIN)
Use of PINs is not mandatory. PINs can be published through OJEU in order to alert the market to forthcoming contract opportunities.
Once a PIN has been published, reductions in timescales for competitions identified in the PIN are possible.
PIN should be published at least 52 days before and not more than 12 months before the contract notice.
The PIN should contain details of supply and services contract for which the public body expects to seek tenders in the next 12 months.
PINs must be published on OJEU website (this can also be done through the Public Contracts Scotland website).
V10 22/11/2018 Slide 37

38. Commodity Strategy Sign-Off – UIG & HOPC UIG:
Name
Title
Institution
Date
HOPC:
Profile & Commodity Strategy approved by HOPC,
APUC: …………………………….
Date: ……………………………...
V10 22/11/2018 Slide 38