PURCHASING BASIC AWARENESS COURSE for purchasing at City University V4

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PURCHASING BASIC AWARENESS COURSEfor purchasing
at City UniversityV4

• 2004

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• Agenda
• Introductions
• Objectives
• What is Purchasing?
• General Information
• The Purchasing Cycle
• Round-Up
• Post Training Validation

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• INTRODUCTIONS
• Your trainer today is
• Angus Warren, Director of Procurement, City
  University
• Attendees
• Your name
• Your role at City

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• Objectives
• This course is designed to
• Provide a basic level training in the key aspects
  of purchasing
• Make you aware of the key impacts of relevant
  legislation
• Describe the processes in place to lower the
  Universitys and its employees exposure to risk
  
• Clarify Roles and Responsibilities of those
  involved in the purchasing process
• Help attendees identify areas in their skill sets
  that may need further development / coaching in
  relation to purchasing.

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• Post Training Validation
• At The End Of This Course.
• There will be 10 Key Questions.
• These questions address the most essential areas
  that must be understood before individuals can
  purchase for the University.
• If there a few areas of concern, advice /
  coaching will be provided if there are
  significant areas then re-attendance of the
  course will be required.

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Purchasing Basic Awareness

• Key information sources relating to this course
  are
• This presentation
• The Purchasing QRG
• The Interim Purchasing Manual
• (new version 1.4 onwards)
• Race Equality and Public Procurement document
  (CRE Publication)
• The Equality Process Flowchart.
• Further supporting data can be found in
• City University Website Purchasing Pages
• City University Financial Regulations
• Commission for Racial Equality Website
  (www.cre.gov.uk).

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Purchasing Basic Awareness What Is Purchasing ?
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What is Purchasing ?
Requisition (new need)
Requisition (sourcing already done)
Measure Improve vendor
Performance
(Sourcing)
(Buying)
Identify Need (firm or possible)
Communicate
Negotiate
Award Contract
Place Further Call-Off (order)
Record Receipt
Pay
Issue Contract
Prepare RFQ
Identify Potential vendors
Issue RFQ
Challenge Need
Prepare Specification
Check Legislation
Identify Risks
Place Call-Off (order)
Identify Actual Need
Challenge Actual Need
Measure Improve Internal Performance
Reporting
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Purchasing Basic Awareness

• The content of this course has been formulated
  based on normal business process practice, audit
  requirements and EU UK law
• It should be assumed therefore that if any of the
  guidelines discussed are breached then it is
  likely that applicable audit regulations or laws
  are being breached.
• Due to the implications of this, it is important
  that the issues discussed are fully understood by
  all attendees.

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• The Universitys existing approach on purchasing
  is as follows
• Generally, operational purchasing administration
  will be devolved to institutes, schools service
  areas.
• Purchasing Services must be advised of, and
  involved in, the buying process from the earliest
  point where a potential need for purchase is
  identified which is likely to exceed 25K.

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Purchasing Overview Key Roles Responsibilities
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• Purchasing Services
• Are the custodians of the Purchasing Process for
  ALL Purchasing at City.
• Responsible for (1)
• Development and review of an approved purchasing
  strategy, policies processes
• Audit of operational use of purchasing process
  and policies
• Training content development delivery
• Managing / co-ordinating the internal dimension

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• Purchasing Services - responsibilites(2)
• Major / strategic spend negotiation across the
  University
• Providing Managing Purchasing Helpdesk
• Devolved purchasing support - primary care by
  tender (gt25K) including ad hoc and major
  initiative spending
• Contracts review management support
• Terms Conditions of purchase management
• EU Purchasing Legislation Process Administration.

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• Authorised Buyers (Purchasing Administrators in
  Purchasing Manual)
• Are those members of staff whose jobs involve
  raising and placing orders with vendors.
• They must ensure (either by undertaking it
  themselves or by obtaining assurance from others)
  that all relevant rules contained in this
  training, the Purchasing Manual and relevant
  legislation, have been complied with at each of
  the steps of the purchasing cycle for the order
  which they are issuing
• Particular care should be taken in relation our
  legal duty to promote equality at all steps of
  the process

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• Authorised Budget Managers (currently also known
  as Authorised Signatories)
• Authorised Budget Managers are given authority to
  authorise expenditure in line with financial
  regulation against nominated budget areas by the
  relevant Budget Holder.
• They must approve expenditure against their
  relevant budgets before purchasing can take
  place.
• They are not authorised to actually purchase
  unless they are also Authorised Buyers.
• They must be sure that the person placing the
  order is a trained and approved Authorised
  Buyer.

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• Senior Management
• Are
• Deans of schools / institutes
• and
• Heads of the two service portfolios the V-Cs
  Office.
• Senior Management have overall responsibility for
  all financial matters relating to their areas.

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• Budget Holders
• Budget holders are given budgetary responsibility
  for nominated cost centres or budgets.
• They must manage the cost centre or budget
  effectively in line with Financial Regulations
  and procedures.
• They must ensure that they do not exceed the
  budget or incur any deficit without the prior
  approval of the Senior Management or the Director
  of Finance and Business as appropriate.
• They will delegate authority if applicable to
  Authorised Budget Managers / Authorised
  Signatories to authorise expenditure against
  their cost centres.

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• Purchasing Co-ordinators
• The senior managers of each school and senior
  directors of each service function should
  nominate a member of staff to act as their
  Purchasing Co-ordinator.
• The Purchasing Co-ordinator will act as a focal
  point for communication from and to Purchasing
  Services and will attend Purchasing Co-ordinator
  group meetings as appropriate.

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• Terms and Conditions of Contract
• Trade should be conducted on the Universitys
  General Conditions of Purchase.
• Agreements on vendors terms and conditions of
  contract/sale etc should not be accepted.
• To trade on a vendors terms in exceptional
  situations, permission must be obtained in
  writing from the Director of Procurement before
  the agreement is entered into.
• Industry standard forms of contract may be signed
  for capital and maintenance works projects and
  associated professional services for Property and
  Facilities.
• Only the following can authorise the use of such
  contracts
• Director of Property and Facilities
• Director of Procurement.
• The Universitys General Conditions of Purchase
  can be downloaded form the Purchasing Services
  Website.

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• Purchasing Cards
• There has been a pilot in operation in the
  University testing the operation of Purchasing
  Cards (P-cards).
• P-card holders must adhere to the rules of issue
  signed by them at the time of issue, as amended
  from time to time.
• P-cards must only be used for the specific
  purpose for which they are issued.
• The decision whether to use P-cards in each area
  is now being considered by Deans relevant
  Services Directors.

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• Corporate Contracts
• Purchasing Services will develop jointly with the
  appropriate areas of the University corporate
  contracts for the supply of goods and services.
  These will be of two types
• Mandatory
• Recommended - orders may be placed with
  alternative vendors, provided
• it can be demonstrated that better value for
  money can be secured by doing so
• the nominated vendor is always given the
  opportunity to quote in such instances, if
  applicable
• the person placing the order with an alternative
  vendor keeps a record of the justification for
  using a vendor other than the nominated
  Contractor.
• A list of the corporate contracts operated by
  Purchasing Services is available on the
  Purchasing Services website.

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• Ethical Standards (1)
• Staff with purchasing responsibility must follow
  high ethical standards in all dealings with both
  current and prospective vendors.
• No employee may accept from any vendor company,
  or representative of a vendor or potential
  vendor, gifts of value (i.e. unless value less
  than 5 per year).
• General gifts, such as wine, beverages, clocks
  and other low-to-medium value goods received from
  time to time must never be retained but should be
  either
• returned to the vendor (only if this will not
  cause offence), or
• passed to the Purchasing Services, who will log
  receipt of the gift and issue a receipt which the
  individual should keep.
• Periodically, these gifts will be raffled and the
  proceeds given to charity.
• Any gift retained by a member of staff obtained
  from a vendor, vendor representative or potential
  vendor, with the exception of very low value
  items, will be deemed to be of the same status as
  a bribe retained.

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• Ethical Standards (2)
• Cash, gift certificates, weekend trips, holidays
  or any other high value gifts etc may not ever be
  accepted under any circumstances.
• Any such offers made should be brought to the
  attention of the Director of Procurement as soon
  as possible.
• Business hospitality is a normal courtesy but
  should also be treated with discretion.
• Occasional business lunches and invitations to
  outside events may be accepted when appropriate.
• They must be registered in the hospitality
  register if a University employees presence is
  being funded by a vendor or potential vendor
  (this includes lunches, dinners etc).
• Offers of extended hospitality (eg hospitality at
  a sports event) from a vendor or potential vendor
  should be referred to the Director of Procurement
  or the Director of Internal Audit BEFORE it is
  accepted.
• Obviously, the taking or providing of bribes in
  any form is strictly forbidden.

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• Ethical Standards (3)
• A register will be kept by the Director of
  Procurement containing a declaration by staff
  involved in purchasing activities, or those who
  may have an influence upon purchasing decisions,
  of any possible conflict of interest.
• This involves any financial interest or direct or
  indirect relationship whatsoever (except purely
  formal business relationships) with parties
  (people or organisations) involved in the supply
  of any goods/services to City University.
• Failure to register such interests will be
  treated with suspicion and may result in
  disciplinary action.

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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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Requirement to Purchase

• Areas to consider BEFORE the process begins
• Approval to Purchase
• Equality in Purchasing
• Applicable Policies
• Sustainability in Purchasing
• Health and Safety
• Risk Management
• Proceeds of Crime Act
• Appropriate Tender Process.

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• APPROVAL TO PURCHASE
• All purchase orders must be formally approved by
  an appropriate authorised signatory (Authorised
  Budget Manager) prior to committing the
  expenditure with the vendor.
• APPROVAL FOR PAYMENT
• Invoices should be authorised in line with
  financial regulations
• A member of staff who commits the University to
  expenditure which is not properly authorised is
  in breach of Financial Regulations and may be
  subject to disciplinary action.

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• Equality in Purchasing (1)
• It is the policy of City University to promote
  equality in all its functions.
• Legislation is now in place that will outlaw
  discrimination on any of the following grounds
• Race (effectively includes nationality)
• Disability
• Sex
• Sexual Orientation
• Religion or Belief.
• All purchasing activities must be carried out in
  a manner that could not be deemed in any way to
  discriminate on any of those grounds.

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• Equality in Purchasing (2)
• Race Relations Act 1976 as amended (RRA)
• Places additional legal obligations on the
  University to promote equality in all its
  functions.
• Due regard therefore must be taken for including
  the activities needed to fulfil this obligation
  at each step of the purchasing process this
  training will address each of these areas.

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• People involved in Purchasing should be aware of
  the Universitys policies on
• Sustainable Purchasing
• Health Safety including their own departments
  HS Policies where applicable

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• Finance / Risk Management
• The Director of Procurement or the Director of
  Finance and Business must approve the terms of
  leasing arrangements before any agreement is
  signed.
• The Director of Finance and Business will keep a
  record of all leasing arrangements for the
  purposes of the Annual Accounts.
• Used or second-hand equipment may not be
  purchased, except with the specific authorisation
  of the Director of Procurement.
• If there is justification for buying used or
  second-hand equipment, the Director of
  Procurement must be satisfied that it is
• of satisfactory quality
• compliant with current standards and regulations
  and
• is supplied with adequate warranties.

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• Proceeds of Crime Act (PCA)
• The PCA is VERY new legislation with little case
  law
• People breaching the act will be those benefiting
  from criminal conduct
• Case law will likely (needs to) clarify the true
  scope of the act.
• As it stands under the act, criminal conduct
  is
• Any conduct that constitutes an offence in any
  part of the United Kingdom, orwould constitute
  an offence in any part of the United Kingdom if
  it occurred there
• For the time being, to reduce the risk of
  breaching the act, Authorised Buyers should take
  reasonable care in evaluating vendors and if they
  have any suspicions that vendors are acting
  unlawfully, either investigate their organisation
  further or look to an alternative vendor.

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How should the requirement be tendered ?
Requirement to Purchase Goods or Services
Requirement authorised by budget manager
Follow appropriate (under 25K) tender /
quotation process
Is value over 25K ?
NO
YES
You Must Contact Purchasing Services
Operate tender process jointly with Purchasing
Services (non-EU process)
NO
Is value over the EU threshold ?
Operate tender process jointly with Purchasing
Services (EU process)
YES
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• EU Procurement Directives (1)
• The directives state that contracts / spend areas
  exceeding the following total values (over a
  4-year period) must comply with the requirements
  of the directives
• SDR 200,000 (153,376) for goods and services
• Euro 5 Million (3,834,411) for works
• Orders or contracts may not be divided in order
  to avoid these value thresholds.

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• EU Procurement Directives (2)
• All EU applicable contracts MUST be managed
  jointly with Purchasing Services who must be
  consulted long before the tendering process is
  due to begin as
• The Directives lay down minimum tendering
  time-scales many tenders will take in excess of
  6 months to process
• At all times, it must be assumed that the
  absolute minimum period of time between
  completion of specification of requirements and
  receipt of tenders (for evaluation) will not be
  less than 80 days (773).

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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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Produce Spec

• There are several key areas to consider when
  developing specifications
• Specification Format
• Barriers to trade / Standards
• Equality.

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• Specification Format
• Specifications should be output based rather
  than process based unless the method of
  delivery is critical or it is required to comply
  with legislation.
• They should be as flexible as possible to allow
  for wider competition.
• They should contain quality requirements and KPIs
  if relevant.
• They must not have requirements that can not be
  justified.
• They must not without good reason have
  requirements that exclude any groups in society
  from tendering.

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• Barriers to Trade / Standards
• European or ISO standards should be used.
• British standards should be avoided and are not
  permitted for EU tenders unless no EU/ISO
  standard exists.
• They should not specify manufacturer brand names
  or specifications except where it relates to a
  genuine need (if you buy integration tools for
  SAP you would need to mention SAP).
• If you can not identify another way of defining a
  spec except by using a given manufacturers
  definition, you should state or equivalent
  after the description.

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• Specification - Equality (1)
• To satisfy your obligations under the RRA, BEFORE
  you create the specification you will need
  answers to these questions
• Who will this impact?
• Obtain racial data for likely end users
• Is the product need likely to differ by racial
  group?
• Is the way that it is delivered likely to differ
  by racial group?
• Identify different groups needs
• Consult end users
• Define spec based on identified needs
• Can requirement or spec be split to add value and
  make available to a greater number of SMEs?

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• Specification Equality (2)
• questions (continued)
• Cross check spec versus Citys Equality policy
• Are there any specific requirements / duties to
  include (reporting etc) in the spec in relation
  to equality?
• This will be effected by the degree of relevance
  of the resultant contract under the RRA
• The relevance will be determined by a combination
  of the product being purchased and how it will be
  delivered
• Ensure spec is flexible enough to deal with
  changing equality requirements
• Ensure that the spec does not contain or omit
  requirements that would disadvantage any end user
  group within the scope of your institution.

highly relevant purchases
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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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Vendor Selection

• The vendor selection process consists of the
  following aspects
• Obtaining Expressions of Interest
• Vendor Evaluation Questionnaires
• Evaluation Consultation with end-users.

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• Obtaining Expressions of Interest (EOI)
• Decide on level of detail (of requirements) to be
  included on EOI
• low level here and more info on RFQ/T or
• all included here.
• On some occasions where there is not absolute
  clarity of what is required or available from the
  marketplace it may be worth stating vendor
  suggested variant offers may be considered.
• Complete the relevant Notice of Tender
  Requirement document
• Define if resulting contract will be of high
  relevance or suitable for general vendors and
  include relevant instruction on notice

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• Obtaining Expressions of Interest (EOI)continued
• Advertise for expressions of interest in
• OJEU if EU (Purchasing Services do this for
  you)
• City University Website Open Tenders List (all
  tenders).
• And if applicable
• Trade Press
• Local Media
• Chamber of Commerce
• Regional Development Agencies Meet the Buyer
  Exhibitions etc.

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• Vendor Evaluation Questionnaires
• If vendors wish to express an interest in bidding
  for City University business they need to
• Advise us of the fact
• Download a copy of our Vendor Questionnaire
  (EHEP) from our website (unless they have done so
  already - check with Purchasing Services)
• Complete it and return it with additional
  documents if required
• Vendors that are to bid for high relevance
  contracts need to complete all sections others
  need not complete section 5C
• OR /
• EHEP Equality in Higher Education Purchasing

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• If purchase is low relevance / low value and it
  is not practical, reasonable or practical to
  obtain completion of the EHEP Questionnaire
• the CREs notice Register should be checked
  but has limited scope
• OR
• You should satisfy yourself by other means
  (possibly verbal but ideally in writing
  dependant on situation) that the vendor has not
  broken any relevant law, particularly in relation
  to our obligation to promote equality
• If a vendor has breached any relevant
  legislation, they should be asked to complete the
  EHEP Questionnaire

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• Evaluation Consultation with End-Users
• When you have responses from vendors expressing
  an interest in bidding you need to
• Score their questionnaire / feedback based on the
  defined EHEP scoring methodology
• Evaluate all other sections / feedback to
  ascertain suitability
• Vendors that have been convicted of breaking any
  law should not normally be used.
• Consult Purchasing services if required.
• Note that if you choose to use a vendor with any
  type of conviction (except motoring unless that
  is relevant to the tender) or one with a low EHEP
  score,
• you should have proof of rectification of
  processes and / or agree an Equality Development
  Plan (EDP) as appropriate

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• Evaluation Consultation with End-Users
• (CONTINUED)
• Note for example that if you purchase from a
  vendor that has been convicted of failing to pay
  the minimum wage, you could potentially be
  prosecuted under the Proceeds of Crime Act for
  purchasing from them if it is found that they are
  again prosecuted for that same crime
• Send a copy of evaluated questionnaires to
  Purchasing Services,
• Who will create a vendor audit database to avoid
  duplication of effort both by vendors and within
  the University
• When unsuitable bidders have been removed, it is
  often of use to discuss potential vendors with
  internal end users.

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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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Issue RFQ/T

• You will need to
• Follow the University EU tender rules
• Issue RFQ/T(s) to all vendors at same time
• Ensure full specification is now issued (if not
  done at EOI stage)
• Consider splitting into specific portions if
  possible / value-adding so that it may be more
  accessible to SMEs / ethnic minority companies
  (but consider EU rules)
• Ensure RFQ/T documents do not exclude any groups.

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Tenders and Quotations Competitive quotations and
tenders must be obtained as follows
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Tenders and Quotations

• If any of the above rules presents serious issues
  or concerns on a specific tender or scenario -
• Purchasing Services or your Purchasing
  Co-ordinator should be consulted to identify an
  alternative solution if it is permitted under
  relevant legislation

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• Request for Quotation (RFQ) Document
• Should be generated based on the template on the
  purchasing section of the universitys website.
  It is key that it contains
• Detailed (but not restrictive) Requirement
  Specifications
• Instructions for return of tender documents to
  ensure that returned tenders will be received by
  the correct person
• A statement that states that the tender that
  provides the best overall value for money for the
  university in the view of the university, is
  likely to be awarded the available business in
  event of business being awarded.

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• Request for Quotation (RFQ) Document continued
• State if short-listing of most advantageous
  bidders for further discussion may occur
• (not EU).
• It is often wise to request vendor suggested
  variant offers in RFQs (if you have included
  this in EOI advert).
• One or more Tenderers may request an extension to
  the time-scale allowed for return of Tenders. If
  there appears to be a good reason to allow this,
  the extension should be offered to all Tenderers.

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Evaluate Quotes / Tenders

• There are two key areas to consider here
• The process for receipt of tenders
• The content of the tenders versus requirements.

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• Receipt of Quotations for Purchases under 25,000
  Basic Principles (1)
• The Quotations should be opened by the Authorised
  Buyer and possibly a witness.
• The quotations should at all times be held with
  all other purchasing documents relating to that
  purchase in a locked storage place (drawer,
  cupboard etc.).
• Prices should not be discussed or in any way made
  available with any persons that do not have good
  and ethical reasons for being involved.
• Actual Prices or any other terms offered by one
  vendor must never under any circumstances
  whatsoever be made available to another vendor.

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• Receipt of Quotations for Purchases under 25,000
  Basic Principles (2)
• However, if a vendor is not the most competitive
  after providing their offers, it is allowed to
  advise them of this fact.
• They are not however allowed to simply re-bid
  lower in isolation.
• If they wish to re-bid, and we are prepared to
  accept revised bids, then all tenderers should be
  advised that reduced bids are being made and they
  are free to re-bid revised closing dates for
  revised bids should be stated to all parties.
• If you are short-listing in tenders, please
  consult Purchasing Services before doing this as
  this is a sensitive area.
• Tenders received after the relevant closing date
  or revised closing date, should not normally be
  considered.

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• Receipt of Quotations for Purchases over 25,000
• Purchasing Services will advise or define a
  process on each occasion.

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• The Content of the Tenders Versus Requirements
• You will need to ensure
• Are offers in line with RFQ/T?
• Are equality requirements dealt with effectively
  on tenders?
• Can full specification be met cost effectively?
• Involve end user community in evaluation if
  possible relevant
• This takes more time but greatly enhances the
  value of the final contract
• Identify best source(s) of supply.

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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
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Negotiate

• In some circumstances (for example most EU
  applicable tenders) it is illegal to negotiate
  post tender, however where it may be permitted
• Check with Purchasing Services for each scenario
• Narrow field to preferred bidders
• Can equality provisions be enhanced?
• Costs negotiated
• Further improved bids?
• Involve end user community if possible
  relevant
• Identify best source of supply.

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The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
65
Place / Award Contract

• The areas to consider here are
• Vendor acceptability status
• Authority levels
• Placing orders
• Amending or cancelling orders.

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• Vendor acceptability status
• If the chosen vendor has broken any law and you
  have chosen to still use them
• Have you received proof of relevant corrective
  actions?
• If vendor has a low EHEP score
• Is equality action plan if required in place?
• Initiate action plan if required.
• If all is OK, place contract subject to TCs
  including equality requirements.
• If forced to order through vendor with
  significant legal or equality issues due to lack
  of alternatives, record in internal contract file
  the information relating to the unsuccessful
  action taken to identify alternatives.

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• Authorisation Levels
• Based on the current Financial Regulations,
  Contracts-Orders may be authorised as follows
  (after signing by Authorised Buyer)
• Orders up to the value of 25,000
• Authorise Budget Manager / Authorised Signatory
  for the cost centre(s) being charged.
• Orders over 25,001
• Authorise Budget Manager / Authorised Signatory
  for the cost centre(s) being charged AND also by
  the Director of Procurement, a Purchasing
  Services Manager or Director of Finance and
  Business.
• Framework contracts and contracts for mandated
  sources need only be signed by a Purchasing
  Services Manager, the Director of Procurement or
  the Director of Finance and Business.

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• Placing Purchase Orders
• Purchases may normally only be made using the
  City University standard official order based on
  the Universitys General Conditions of Purchase.
• There are four order types in use currently
• Manual sub 20K (being updated to 25K) Order
  Form
• Manual High Value (over 20K being updated to
  25K) Order Form
• Consultant Lecturers Order / Contract
• SAP Purchase Orders.

69

• Placing Purchase Order (continued)
• If, due to urgency, a verbal order is necessary,
  the order must still have received formal
  authorisation and the official order number must
  be quoted to the vendor
• The order form should be completed and sent to
  the vendor as confirmation by post at the
  earliest opportunity.
• All purchase orders must state clearly the
  requirement and show the pricing arrangements in
  force.
• Prices MUST be inclusive of insured delivery to
  our desired final destination.

70

• Placing Purchase Orders (continued)
• A copy of every order placed must be sent to
  Purchasing Services.
• All purchase orders should be kept in locked and
  secure storage areas.
• Pads of official orders are kept in Purchasing
  Services and will be available to Authorised
  Buyers or Purchasing Co-ordinators only.
• Purchasing Services will hold a register of the
  pads issued.
• Confirmation Orders
• For verbal orders
• Confirmation orders must be clearly marked
  Confirmation of Verbal Order If possible, the
  vendors reference should also be quoted.

71

• Order Amendments (All Orders)
• Order amendments must never be issued without the
  prior agreement of the vendor to the changes
  deemed necessary.
• Order amendments which increase the scope of
  purchase (e.g. increase in quantity and/or price)
  or substantially alter the nature of the
  agreement (e.g. change of validity of agreement)
  must be authorised as if they were new orders
  based on total value
• Order Amendments for Manual Orders
• Should be transmitted by fax or letter (which
  contains the signatories of the authorised
  signatories), referencing the original purchase
  order number, clearly stating THIS IS AMENDMENT
  TO ORDER NUMBER.
• Details of the original order which no longer
  apply and what the new details of the agreement
  are should both be stated.

72

• Order Amendments for SAP Orders
• Order amendment for SAP orders should be output
  from SAP - it must be noted very clearly in the
  header text that this is an order amendment.
• The items that have changed must be noted also on
  the order.
• The header texts and the note of items changed
  must be printed out on the copies sent to he
  vendors (sometimes SAP will state the changes, in
  others it will not, depending on the type of
  changes made and print version).

73

• Order Termination (All Orders)
• If an order is no longer required and the vendor
  agrees to the cancellation of the order, a fax
  should be sent to the vendor, referencing the
  order number and the agreement to cancel, stating
  clearly the order is now cancelled.
• In the case of need of termination of a purchase
  order/contract through breach of conditions,
  Purchasing Services must be advised and their
  approval sought before this is done.

74

• Order Termination For SAP Orders (additionally)
• If no delivery has taken place against the order,
  the order lines should be marked as deleted.
• If some goods have been delivered, the delivery
  complete indicator must be selected for the
  relevant line items.
• It must be noted very clearly in the header text
  within SAP that the order is cancelled, when and
  why.

75
The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
76
Delivery

• The areas to consider here are
• Is the vendor supplying in line with order
  requirements?
• Is the method of delivery successfully complying
  with equality requirements of the specification
  the RRA generally?
• Are persons involved in delivery aware of
  required equality based behaviours and performing
  to acceptable standards?

77
The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
78
Vendor Paid

• Has vendor complied with all requirements
  including equality?
• If not, are there liquidated damages clauses
  applicable ?
• Invoice should be authorised in line with
  Financial Regulations

79
The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Purchasing Strategy
Review Report
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
80
Monitor Performance / Review Requirements

• Is the delivery of goods or service delivery
  successfully complying with all requirements of
  the order/contract including equality?
• If not,
• Make vendor aware of issues in writing and follow
  up.
• Is an Equality Action Plan required ?

81
Monitor Performance / Review Requirements

• If of high relevance under the RRA
• Are equality monitoring processes being complied
  with?
• Is vendors action plan (if applicable) being
  followed through?
• Is provision still matching need and providing
  equality of access to purchased goods / services?

82
The Purchasing Cycle
Requirement to Purchase
Produce Spec
Monitor Performance / Review Requirement
Vendor Selection
Vendor Paid
Issue RFQ/T
Delivery
Evaluate Quotes / Tenders
Place / Award Contract
Negotiate
83

• And Finally,
• Dont forget you are not on your own.
• Purchasing Services are here to help
• If you come to an issue that you are not
  confident in dealing with, call us.
• Purchasing Helpdesk 8003.

84
Equality Process Flow Chart
Requirement to Purchase
Obtain Racial Data for Target Area
Is the product need likely to differ by racial
group ?
Is the way it is required to be Delivered likely
to differ by racial group ?
Complete Full Spec ensuring built-in flexibility
to deal with potential changing equality
requirements
Can spec be split to enhance value / promote
equality in tendering ?
NO
NO
YES
YES
Advertise for exp of interest in (ensuring
advert/spec does not exclude any racial
group) OJEU if-req, press / open tender list
websites etc
Does preferred bidder need Equality Dev Plan
(EDP) based on questionnaire score?
YES
Consult end Users Define Product Spec
Consult end Users define product /
service DELIVERY Spec (when, by whom, using which
medium)
Cross check to ensure compliance with
Organisations Equality Strategy
NO
Do they agree to EDP ?
Is requirement for service to be delivered on
site and / or highly relevant goods ?
Issue vendor questionnaire with EHEP sections 1-3
to be completed
Receive Tenders / Quotes. Narrow field to best
bids. Negotiate (if applicable)
Consider technical/ equality / financial
capabilities - involve end users. Decide on
preferred bidder.
YES
YES
NO
NO
Award contract to preferred bidder subject to
relevant TCs including Equality requirements
Issue vendor questionnaire with EHEP sections 1
2 to be completed
Evaluate questionnaire
Issue RFQ/T to vendors that meet minimum
standards. Ensure RFQ/T does not exclude any
racial group
Is there an acceptable alternative bidder who
does not need an EDP or who agrees to one if
required ?
YES
Award contract to next most preferred bidder
subject to relevant TCs including Equality
requirements
NO
Check delivery of product and actual product
complies with specification including equality
Review ongoing requirements
Update spec, vary Contract if applicable
Must /or Can a bidder be used (not on-site
service) or will re-tendering (on site service)
be required ?
YES
Award short term contract to best available
bidder subject to relevant TCs including
Equality requirements
NO
85
Course Round Up
86

• Objectives
• Were the objectives met?
• Provide a basic level training in the key aspects
  of purchasing.
• Make you aware of the key impacts of relevant
  legislation.
• Describe the processes in place to lower the
  University and its employees exposure to risk.
• Clarify Roles and Responsibilities of those
  involved in the purchasing process.
• Help attendees identify areas in their skill sets
  that may need further development / coaching in
  relation to purchasing.

87
Any Questions..?
88
Post Training Validation

• 10 Key Questions
• Please complete the answer sheet now and hand it
  to me before you leave.
• These questions address the most essential areas
  that must be understood before individuals can
  purchase for the University.
• If there a few areas of concern, advice /
  coaching will be provided if there are
  significant areas then re-attendance of the
  course will be required.

89
Thank You for attending!
90
Likely Highly Relevant Purchases (1)

• Services On Site (all highest relevance) may also
  be off-site but will still be of high relevance
• Consultant lecturers
• Assessors
• Maintenance
• Construction / Works
• Agency temp staff
• Consultancies / Consultants
• Nurseries / Child care facilities
• Printing Design services
• Catering
• Cleaning
• Security

• Waste disposal
• External auditors
• Services to students (accommodation, computer
  services, libraries)
• Trading units on site

Press for Next Page of Highly
Relevant Purchases
Press to Go Back to Equality Page
91
Likely Highly Relevant Purchases (2)

• Services Off Site (highest relevance)
• Recruitment agencies
• Uniform Providers
• Advertising / Marketing agencies
• Services Off Site (high relevance)
• Publishers
• Legal advice
• Banking
• Insurance
• External research
• And any other purchase situation where the vendor
  directly interacts with your staff or students or
  with members of the public in the vicinity of
  your facilities.

Press for Previous Page of Highly Relevant
Purchases