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Flashcards in Procurement Terminology Deck (29):
1

Administer Procurements

The process of managing the relationship between buyer and seller

2

Bill of Materials (BOM)

A formal document showing the hierarchy of components or pieces and their sub-components or sub-pieces that make up the product

3

Buyer

The person or group in an organization that acquires products, services, or results

4

Claim

A demand for consideration, under the terms of a contract, by a buyer from a seller or by a seller from a buyer

5

Close Procurements

The process of completing the contract; includes settlement on any open items

6

Conduct Procurements

The process of receiving proposals, quotes, and bids, selecting a seller and establishing a contract for goods or services

7

Contract

A mutually binding agreement that requires the services provider to supply the specified services or goods and requires the buyer to pay for them per the terms of the document

8

Cost-plus-fixed-fee (CPFF) Contract

A contract in which the supplier receives payment for allowable costs plus a fixed fee typically based on estimated cost

9

Cost-plus-incentive-fee (CPIF) Contract

A contract in which the supplier receives payment for allowable costs, as well as a pre-negotiated fee and an incentive fee (if incentives are met)

10

Cost-plus-percentage of Cost (CPPC) Contract

A contract that reimburses the seller for cost, plus a negotiated percentage of the total costs

11

Cost-reimbursable (CR) Contract

A contract in which a supplier is paid for direct and indirect cost actually incurred on the project

12

Firm-fixed-price (FFP) Contract

A contract in which the seller provides products or services based on a well defined scope of work for a set price

13

Fixed-price Contract

A contract that pays a seller a fixed price for a well defined or detailed product or service

14

Fixed-price-incentive-fee (FPIF) Contract

A contract in which the seller provides products or services based on a well defined scope of work for a set price; also includes a fee structure that provides more payment for achieving predefined performance objectives

15

Issue

A project item causing confusion or disagreement, or an unresolved item needing attention

16

Make-or-buy Decision

An initial part of the procurement process in which a decision is made to either create the product by the company that needs it, or to outsource it and have another company create it

17

Plan Procurements

The process of determining what to buy, the optimum method to make the purchase and creating the documents associated with it

18

Point of Total Assumption

The total amount of money the buyer will pay regardless of cost overrun on the contract

19

Procurement

The acquisition of goods or services from an outside source (vendor)

20

Procurement Documents (Output/Input)

Documents involved in the bidding and proposal activities; can include request for information (RFI), request for quote (RFQ), or request for proposal (RFP)

21

Procurement Management Plan

The process of attaining goods and services for a project from outside the organization

22

Request for Information (RFI)

A request to a potential seller from the buyer for specific information

23

Request for Proposal (RFP)

A document that describes what the buyer wants from a potential supplier, as well as criteria for acceptability of the vendor

24

Request for Quote (RFQ)

A document used to get bids or quotes from possible suppliers, usually for commodity type items, with minimal customization

25

Retainage

A part of the payment per the terms of the contract that the buyer retains until the project is complete; used to ensure that the seller completes the work per terms of the contract

26

Seller

An individual or company that provides goods or services to a company or individual

27

Statement of Work (SOW)

A description of services, products, and work results to be accomplished on a project or other initiative

28

Termination Clause

A clause in the contract that allows both the buyer and the seller to end the contract

29

Time and Material (T&M) Contract

A contract that provides for acquiring services at specified fixed hourly rates and materials at cost.