Procurement

Question 1

Procurement

Answer 1

Process of purchasing goods or service from an external supplier for use within the organization at the best price with cognizance of the economies of scale.

Question 2

What does the process of procurement ensure?

Answer 2

It ensures that the goods and services procure are appropriate and acquired at the best possible prices, to suit the need of the organisation in terms of quality, quantity, time and allocation.

Question 3

Basic concepts of procurement

Answer 3

Transparency- on contract information and procedure to the prospective tenderers.
Equal treatment- unbiased competition.
Non-discrimination- no obstacles to the suppliers.
Value for money- optimum combination of adequate cost and fitness to customers requirements
Thresholds- dependent on the organisations policy.
Integrity- of officers

Question 4

Parties to the procurement process

Answer 4

1. The purchasing entity
2. Supplier
3. Need - the expressed requirement by the organisation

Question 5

Common procurement practices

Answer 5

1. Direct sourcing
2. Restricted tender
3. Open tenders

Question 6

What is direct sourcing?

Answer 6

Obtaining from a single supplier- organization requires goods of a specific standards.

Question 7

What is restricted tender?

Answer 7

Obtaining them from pre-qualified suppliers- suppliers are assessed against a pre-determined criteria.

Question 8

What is an open tender?

Answer 8

Obtaining from any supplier who applies to the organisation through the open tendering process i.e advertisements in newspapers.