Strategic Procurement - Discussion

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The purchasing process

For full details on the purchasing process, see the Financial Management Practice and Procedures Manual - Chapter 4.

Supplier contracts

There are a number of differing supplier contracts that the University can use for the supply of goods or services. Some may be exclusive to the University, or be in partnership with one or more other universities; others may be arranged by either State or Federal government departments for use within their own departments or by other approved bodies.

If a supply contract exists, it obviates the need to obtain competitive quotes.

When accessing a contract, the contract number should be quoted in all corresponding documentation when using either the Corporate Card or a Finance System Requisition (training page). It is important to do this, as it justifies not getting other quotes, and satisfies audit requirements.

Some of the more common terms used for contracts are:

• PSA - A Preferred Supplier Arrangement. This is generally an arrangement between the University and a specific supplier or range of suppliers for the supply of specific goods and or services at agreed prices or rates, and under specific terms and conditions. A PSA is generally arrived at after an exhaustive tendering process and evaluation of the goods/services and the supplier/s. PSAs are optional, they are not mandatory, but if you do not use a PSA, then you must be able to justify why you see it necessary to do so, and you must also obtain the requisite number of quotations or engage in a Planned Procurement exercise as detailed in the Financial Management Practice and Procedures Manual, Chapter 4(A).

• SOA - A Standing Offer Arrangement - These are MANDATORY, and where they exist you must use them.

• Education Department contracts may also be used by QUT; they are generally prefixed with EDPSA, as in EDPSA101.

• ITO or RFO - Invitation to Offer, or Request For Offer. These are terms used for the tendering process, where tenders are called for the supply of goods or services. They are not supply contracts in themselves, but can result in a contract being awarded, but not always.

The University's contracts are usually prefixed with PSA. Joint contracts with other universities are generally prefixed with UNIPSA.

PSAs can be initiated by a Responsibility Centre if they see a need for an on-going requirement. Likewise, Supply Services or Computing Services can detect the need for a PSA to be put in place, and will consult with Responsibility Centres in this case. PSAs put in place by either approach will be made available to all Centres within QUT. As a general rule, any PSA will have a life of 12 months, with an option to extend for either one or two further 12 month periods.

Responsibility Centres can arrange their own PSAs, but if an approach is made through Supply Services, it may be seen as an advantage to include other Responsibility Centres in the action to increase the University's buying power.

See also the SOA/PSA register for some of the current common arrangements.

Purchases subject to special provisions

The University has instituted special controls over the procurement of certain items or services to ensure compliance with policies, government regulations or guidelines on their use. Items in this category are listed in the Financial Management Practice and Procedures Manual, Chapter 4(A).8.

Industrial Supplies Office (ISO)

Industrial Supplies Office (ISO) is an industry assistance organisation, finding the best Australian products, services and capabilities for private sector and government buyers. The priority of ISO is to increase the local content in projects and procurement activities in Queensland and Australia. They are subsidised and supported by the Queensland Government - Department of State Development.

ISO provides free services to replace imports or to retain opportunities for capable manufacturing or services in Australia. They have a national industry capability database to support a strong team of professionals in engineering and technology. ISO in Queensland is part of a national network of offices, with over 70 experienced professionals across Australia.

ISO seeks and receives enquires on local capability from clients in all sectors. They research and evaluate the local industry capability matched to the client s requirements and verify all potential local supply solutions, while maintaining strict client confidentiality. Further information can be obtained from the ISO Brisbane office:

Industrial Supplies Office (Queensland) Ltd
74-76 Bowen Street
Spring Hill, Qld 4000

PO Box 128
Spring Hill, Qld 4004

Telephone: (07) 3832-4577
Facsimile: (07) 3839-3067

E-mail: info@isoqld.com.au
Website: www.isoqld.com.au

Describing the Requirement (Writing the Specification)

There are a number of useful Qld Government Quick Guides available on-line at http://www.qgm.qld.gov.au/02_policy/better_purch.htm which may be of some help in developing a specification.

Briefly, the main purpose of writing a specification is to indicate, unambiguously, exactly what the requirement is. There are a number of things you cannot say, such as stipulating a brand name, unless it is qualified. Eg. You cannot say you want a "Ford sedan", but you could say "Ford Fairlane, or equivalent". Ideally you would say "5-passenger sedan", so as to indicate what you require, without excluding manufacturers of other brands or styles of 5-passenger vehicles.

The essence of the specification should be to observe the spirit of one of the five fundamental principles of the State Purchasing Policy, "Open and Effective Competition".

Trade-in of existing equipment

Existing equipment can be offered as a trade-in on the requirement at the same time as offers are being sought. Quite often this is a better way to dispose of old or obsolete equipment. An alternative is to send the old or obsolete equipment out to auction. Heads of Responsibility Centres will need to evaluate the offered price against its potential market value less the contingent costs of disposal and make a decision as to the best method to adopt.

Whichever method of disposal is adopted, an "Application to Write off Assets" form should be completed and forwarded to the Equipment Officer, Corporate Finance, for approval by the Director, Corporate Finance.

Quotations

Detailed instructions as to requirements for seeking quotations is available in the Financial Management Practice and Procedures Manual, Chapter 4(A). paragraphs 18 to 32.

The Tendering Process

Responsibility Centres may, if they choose, call tenders (i.e. Invite Offers to supply) within their own areas, with involvement of Supply Services. Sample documents for both RFO’s and consultancy contracts are available as Word templates from Supply Services by sending an email to qut.finpo@qut.edu.au.