Procurement Plan

Project Name:

Example

Prepared By: Title: Version No: 1.0

Document Change Control

The following is the document control for the revisions to this document. Version Number Date of Issue Author(s) Brief Description of Change

Definition
The following are definitions of terms, abbreviations and acronyms used in this document. Term Definition

Procurement Plan

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Table of Contents
1 PROCUREMENT REQUIREMENTS.................................................................3
1.1 REQUIREMENTS.............................................................................................................................. 3 1.2 PURPOSE...................................................................................................................................... 4 1.3 JUSTIFICATION................................................................................................................................ 4

2 MARKET RESEARCH...............................................................................5
2.1 MARKET CONDITIONS...................................................................................................................... 5 2.2 AVAILABLE PRODUCTS..................................................................................................................... 5

3 PROCUREMENT PLAN ............................................................................5

3.1 SCHEDULE.................................................................................................................................... 5 3.2 ASSUMPTIONS................................................................................................................................ 6 3.3 RISKS........................................................................................................................................... 6

4 TENDER PROCESS.................................................................................6
4.1 OVERVIEW.................................................................................................................................... 6 4.2 DOCUMENTS.................................................................................................................................. 6

5 PROCUREMENT PROCESS........................................................................7
5.1 OVERVIEW.................................................................................................................................... 7 5.2 DOCUMENTS.................................................................................................................................. 7

6 APPENDIX...........................................................................................7

1 Procurement Requirements
Identify the products to be sourced from outside the organization, the purpose of each product and the justification for procuring it as opposed to sourcing it internally.

1.1 Requirements
Describe the specific products and quantities to be sourced from the external market place as well as the budgeted expenditure for each product, using the following table: ID
CH1

Product
Computer Hardware

Description

Quantity
Amount

Budget
$

Latest specification computer Intel PC including: Screen (19 inch monitor) Computer unit (latest Intel processor) Accessories (keyboard, mouse) Latest Windows Operating System MS Office software suite Building construction materials, including: Wooden framing for walls Roofing materials Electrical cabling and switches General consultancy services to assist with the management of the project, including:

RM1

Raw Materials

Amount

CS1

Consultancy Services

Amount

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Quality assurance and auditing Project office management Accounting services

1.2 Purpose
Describe the purpose of each product within the following table: ID
CH1 RM1 CS1

Product
Computer Hardware Raw Materials Consultancy Services

Purpose
To enable project management and administrative staff to oversee the project by recording and tracking progress against project plans To physically construct the deliverables to be produced by the project To provide confidence that the project will achieve the time, cost and quality targets through regular reviews and reporting

1.3 Justification
Provide sound reasoning as to why the above products must be acquired from external suppliers as opposed to from within the business, using the following table: ID
CH1

Product
Computer Hardware Raw Materials

Justification

There are no available PCs within the business of a suitable specification to perform the required tasks The business does not currently have sufficient spare raw materials to produce the project deliverable There are no human resources within the business suitably qualified to undertake the activities required

RM1

CS1

Consultancy Services

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2 Market Research
Conducting market research is critical to ensuring that the right product is readily available in the market place at the right price. Questions such as "Which products are available?"; "Will they meet the requirement?"; and "Are suppliers able to deliver the product at the right price within the timescales needed?" are all questions which need to be answered before the Procurement Plan can be completed. Undertake a thorough market research exercise and document the results of the research program within the following section.

2.1 Market Conditions

Identify the various market conditions related to the supply of the products listed in the section above. The types of market conditions to be considered include: Political environment (Is it stable? Will influences in the exchange rate have a bearing on product pricing? Is change likely?) Technological trends (Will new technologies present new opportunities or threats?) Market segment (How many suppliers are in this particular market segment?).

2.2 Available Products

List a sample of the potential suppliers and currently available products to provide confidence that there are products available in the market place which will likely meet the requirement within the budget stated. Cross reference the supplier name, available product and current price with the product ID above, using the following table: ID
CH1

Supplier Name
ABC Ltd

Supplier Product

Price
$

Intel PC, including: Screen (19 inch monitor) Computer unit (latest Intel processor) Accessories (keyboard, mouse, CD reader) Building construction materials, including: Wooden framing for walls Roofing materials Electrical cabling and switches Consultancy services, including: Quality assurance auditing Project Office management Accounting services

RM1

DEF Ltd

CS1

XYZ Ltd

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3 Procurement Plan
3.1 Schedule
Schedule the activities required to complete the tender, deliver the required products and review the suppliers performance.
ID 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 REVIEW SUPPLIERS Review Supplier xxx Review Supplier xxx Review Supplier xxx Supplier Reviews Complete 23 days 2 days 2 days 2 days 0 days 18/03 DELIVER PRODUCTS Deliver Product xxx Deliver Product xxx Deliver Product xxx All Products Delivered 30 days 10 days 10 days 10 days 0 days 24/03 Task Name PRODUCE TENDER Issue RFI Document "Statement of Work (SOW)" Document "Request for Information (RFI)" Release Tender Documents (RFI and SOW) Receive & Evaluate Tender Responses Select Tender Shortlist & Notify Suppliers Issue RFP Update "Statement of Work (SOW)" Document "Request for Proposal (RFP)" Release Tender Documents (RFP and SOW) Receive and Evaluate Tender Responses Select Preferred Tender & Notify Suppliers Issue Contract Document Supplier Contract Negotiate Supplier Contract Sign Supplier Contract Initiate Contractual Obligations Tender Process Complete ary Duration 5/01 28 days 10 days 2 days 2 days 2 days 2 days 2 days 10 days 2 days 2 days 2 days 2 days 2 days 8 days 2 days 2 days 2 days 2 days 0 days 11/02 12/01 19/01 26/01 February 2/02 9/02 16/02 23/02 March 1/03 8/03 Apr 15/03 22/03 29/03

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32 33

30

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3.2 Assumptions
List any assumptions made during this Procurement Planning exercise. For example: It is assumed that: The procurement requirements will not change There will be no changes to market pricing The pool of current suppliers will be available as required.

3.3 Risks
List any risks identified during this Procurement Planning exercise. For example: The procurement requirements may not be defined in sufficient detail to provide potential suppliers with an in-depth understanding of the project requirement The methods undertaken to review supplier performance may not provide adequate confidence that the suppliers will meet the specified procurement requirements The resource allocated to undertake the supplier reviews may not be appropriately skilled to complete the activity as required.

4 Tender Process
Summarize the Tender Management Process.

4.1 Overview
The purpose of the Tender Management Process is to provide a clear, robust and fair process for the appointment of preferred suppliers for the acquisition of product for the project. In summary, the Tender Process will be undertaken by this project through the implementation of three key processes: Issue RFI Issue RFP Issue Contract.

4.2 Documents
List any other documentation used when undertaking the tendering process. For example: Statement of Work (SOW), Request for Information (RFI), Request for Proposal (RFP), Tender Register.

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5 Procurement Process
Summarize the Procurement Process or reference a more detailed Procurement Management Process document.

5.1 Overview
"The Procurement Management Process is undertaken to ensure that all products (i.e. goods and services) are ordered, delivered and received in accordance with the Procurement Plan and that the performance of the supplier providing the products is adequately managed." The Procurement Plan lists the products, suppliers and timeframes for acquisition by the project. The Procurement Process ensures that the products outlined within the Procurement Plan are acquired on time, are within cost and at the level of quality required. To ensure that procurement is handled correctly, a Purchase Order document is completed for each single / bulk purchase. A Purchase Order sets out the specific product(s) required, the delivery urgency, the location for delivery and the cost center to be charged for the delivery. Purchase Orders are usually approved by the Project Manager and the delivery information is recorded within a Procurement Register. In summary, Procurement Management will be introduced to this project through the implementation of three key processes: The issuing of Purchase Orders The completion of Purchase Orders The management of supplier contracts.

Note: This process caters for the procurement of all types of Products, including goods (e.g. computer hardware, raw materials and equipment) and services (e.g. raw labor, technical services, consultancy and management).

5.2 Documents
List any other documentation used when purchasing product for the project (e.g. Procurement Register, Purchase Order Form).

6 Appendix
Attach any documentation you believe is relevant to the Procurement Plan, including: Project documentation (e.g. Business Case, Feasibility Study, Terms of Reference, Project Plan, Resource Plan, Financial Plan or Quality Plan) Requirements Analysis or Needs Analysis documentation Market Research materials Other relevant information or correspondence.

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