PROCUREMENT

MANAGEMENT
PROCUREMENT MANAGEMENT
involves the systematic process
of identifying and purchasing the
necessary goods, supplies,
materials, products or services to
complete the task of the project.
 The PROCESS involves
managing contracts and
administering purchase orders,
thus, it revolves around the
buyer-seller relationship and
the implementation of the
binding agreement.
 PROCESSES
 Plan Procurements
 Conduct Procurements
 Administer Procurements
 Close Procurements
 The PLANNING
PROCUREMENT PROCESS
involves two(2) steps:
SPECIFICATION and
SELECTION activities.
 Plan Procurement
SPECIFICATION refers to identifying,
detailing and recording the list of
procurement items such as goods,
supplies, equipment, civil works,
building, drainage or consulting
services necessary to implement
the projects.
 Plan Procurement
SELECTION is the listing of potential
suppliers of goods, works and
services; and settling vendor
selection criteria.
The plan shall observe procurement
principles & standards…

 Fairness
 Effectiveness
 Economy
 Transparency
 Accountability
CONDUCTING
PROCUREMENT involves
communicating wit suppliers and
service providers; obtaining proposals
and quotations; selecting the vendor
or contractor based on set criteria;
and awarding of contract.
ADMINISTERING
PROCUREMENT involves
managing procurement relationships,
monitoring and ensuring that supplier
or service provider meets the
requirements, terms and conditions
as per contract.
CLOSING PROCUREMENT
involves the verification that all
goods, works and services provided
by the supplier, contractor or
service provider were delivered
correctly and satisfactorily as per
signed agreement..
NOTE:
An important activity of the closing
procurement process is the
preparation of lessons learned in
managing the contract which could
be the recording of good practices
and failures that could aid in future
procurement activities.
 Procurement
Management Tools
 Make or Buy Analysis
 Types of Contracts
 Make or Buy Analysis
It is the process of deciding whether
certain goods, works or services
should be
OUTSOURCED/SUBCONTRACTED
or that all or some items are
IN HOUSE or DO-IT-YOURSELF
 TYPES OF CONTRACTS
 Fixed Price Contract
 Cost Reimbursable Contract
 Time and Materials Contract
FIXED PRICE CONTRACT
Also called as Lump Sum Contract,
it is the most commonly used type
since price will not be modified
unless there are changes in the
Scope of Work.
 COST REIMBURSABLE
CONTRACT
Contractor is reimbursed for all
allowable costs for performing the
tasks and received a predetermined
incentive fee when a certain
performance objectives are met but
a penalty for late delivery.
 TIME AND MATERIALS
CONTRACT
Considered as the hybrid type, this
contract contains both features of
fixed price and cost reimbursable
contract types.