UN Procurement Procedures

1. UN Procurement Procedures

2. Formal procurement method: ITB/RFP Informal procurement method: Shopping/RFQ Request for procurement action Development of specifications/TOR/SOW Identification of suppliers Market research Selection of procurement method The Procurement Process Strategic analysis/ Procurement plan

3. RFQ – Request for Quotation, Up to USD30,000 Used for Goods and Services Identify potential Suppliers Document 3 Quotatations Used for Services (can incl. Goods) RFP Request for Proposal, Over USD30,000 Used for Goods and Civil Works ITBInvitation to Bid, Over USD30,000 Contract management Formal procurement method: ITB/RFP Contract management Separate Evaluation Evaluation Lowest Price The Procurement Process Informal ‘Shopping’ Less than USD2,500 Advertisement Preparation of formal solicitation documents Advertisement Preparation of formal solicitation documents Bid Receipt & Opening Separate Bid Receipt & Opening Tech & Fin Contract approval process Contract approval process Contract award Contract award Lowest Priced Compliant Bidder Best Scored bidder

4. Informal Used for Goods and Civil Works RFQ – Request for Quotation, Up to USD30,000 Used for Goods and Services Identify potential Suppliers Document 3 Quotatations ITBInvitation to Bid, Over USD30,000 Used for Services (can incl. Goods) RFP Request for Proposal, Over USD30,000 Post Qualification/Pre-shipment Inspection Prequalification Expression of Interest ‘Shopping’ Less than USD2,500 Advertisement Preparation of formal solicitation documents Advertisement Preparation of formal solicitation documents Contract management Formal procurement method: ITB/RFP Bid Receipt & Opening Separate Bid Receipt & Opening Tech & Fin Separate Evaluation Evaluation Lowest Price Contract approval process Contract approval process Contract award Contract award Contract management Lowest Priced Compliant Bidder Best scored bidder The Procurement Process

5. Additional processes • Expression of Interest Used as part of market researchIdentifying and prequalifying suppliers Keep abreast with new developmentsDoes not necessarily result in procurement • PrequalificationCan form part of ITB/RFP Used for high-risk goods such as pharmaceuticals, condoms Used for where high impact if delivery fails, such as elections Confirming manufacturing, quality standards, other issues i.e. child labor Very specialised for pharmaceuticals • Post Qualification/Preshipment InspectionUsed as part of testing pre-contract stageEnsuring equipment works under special conditions

6. Samples of EOI Agency website, UNPD Agency website, UNDP

8. Request for Proposal (RFP) • Application: • Used for formal competitive bidding when requirements cannot be described in a definite or complete manner, i.e. when a technical or other solution is sought (TOR). • Normally used for procurement of works and services. Two-envelope system (technical and financial proposal). • Important: • Evaluation Criteria must be part of RFP. • Award of contract: • Select proposal that offers the best value in accordance with evaluation criteria.

9. RFP Process Illustrated • Based on actual case • Procument of Services results in RFP method • Project for Guard Security Service for UN offices in Pakistan • UNDP Pakistan country office requested UNDP/IAPSO in Copenhagen to undertake procurement on their behalf • Security service also for other UN Agencies in Pakistan • Case illustrates:EOI Pre-bidding meetingDetailed Tender DocumentationExamples of Evaluation Criteria related to ServicesExamples of OutcomesRFP resulting in Direct ContractingAnd another unexpected turn in events . . . • Confidentiality . . . Names and documentation • NB: RFP can also be done for goods, e.g. part of complete solution, or where there could be alternative or varied goods to meet the same need

10. EOI Reason Supply market analysis Needed to comply with UN Security Council requirements Preqaulification Published on IAPSO website and in local media Outcome 19 EOIs Received 8 Companies shortlisted

11. RFP RFP Participation only for short listed suppliers in this case Why? Control of process . . . Required 3 compliant bids If no prequalification, all welcome to participate

12. What to look out for • Allow to bid on sections or only total requirements • Pre-bidding meeting • Clarifications and AmendmentsCommunicated to allSuggesting alternativesAdvise on short delivery times

13. Pre-bid meeting • CVs for staff • Suggestions by suppliers • Letters rule • Detailed evaluation method not disclosed

14. Pre-bid meetings and visits • Open to suggestions • In UN’s interest to have compliant bids

15. Details • Language • Checklist of documents • Use the correct format!! • Impressions and facts

16. Policies and Standards • Quality Standards vary • Supplier Code of Conduct • NB:No pricing informationNumberingProprietary InfoConfidentiality

17. More Details • Quote in requested currency • Note: Letter overrule figures • SignaturesCopies • Payment terms not negiotable

18. Deadlines • No exceptions! • Time difference • Envelopes

19. Opening and Evaluation • Committee • Errors • Non-responsive bidsLateUnsignedIncompleteWrong format • Tech & Fin Proposals

20. Formula

21. Actual Score sheet Company B Company A • Ranking

22. Details of Evaluation

23. Actual document and Evaluations

24. Actual evaluation comments

25. Technical Evaluation Outcome

26. Contract • Cancel processPoor processLack of fundsChange of needs • Flexibility and patience required

27. Performance Security and Payment • Bank guarantees/performance security • Payment terms not negotiable • 30 days after delivery • Could be staggered depending on services/goods Page 31

28. The form

29. Page 24 Performance • Crucial • Share information via UNGM • Vendor eligibility policies

30. Page 27 Price Schedule

31. Financial Proposal’s Opening Company A Company B

32. Financial Proposal Company A Company B

33. Internal Review of Procurement Process • For all processes over USD30,000 • Between 30,000 – 300,000 Local approval • Over USD300,000 approval at HQ level • Thresholds vary

34. Headquarter Review • Review: ProcessValue For MoneyQuality AssuranceDocumentationOutcome: • Queried number, qualification and supervision of guards • Seeked report on performance of Company A (existing supplier) • Concerned about limited competitionand requested outcome of evaluation results • Performance report shows issues with supplier ... • Meeting with supplier to address issues • Rewarded for 6 months period and measures and stringent arrangements put in place to monitor

35. How the ITB Process Differ? • Used for goods and works where specific quantities are available. • Simplified process, comparison simple Instructions to bidders includes: • Incoterms 2000 • Delivery dates FCA and FOB • Freight arrangements • After-sales service • Training • Spare parts • Deviations from specifications • Country of origin information and developing countries

36. Supplier qualifications

37. Evaluation Criteria • Compliance with GTAC • Supplier Criteria • Technical Specs • Price and Delivery Time

38. Price schedule • Do NOT change format

39. Deviations

40. Practical Tips

41. Practical Tips for Potential Vendors • Research UN agencies and traditional items/services required • Marketing your goods and services Look for EOI Post/e-mail information English on website Start where you are doing business • Register on www.ungm.org E-mail address Correct coding Key words Up to date Respond to reminders

42. Practical Tips for Potential Vendors • Finding opportunitiesUNGM – Tender Alert ServiceAgencies’ websites • Always respond • Pay attention to:Deadlines, timezonesFormatLanguageCurrencyAddressing of envelopes • Seek clarification

43. Practical Tips for Potential Vendors • Attend Bid Openings or ask Embassy/Consulate • Prepare to meet new challengesKits, training materials, after-sales serviceAwareness of environmental concerns • Be patient and perservere