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Procurement process


Procurement process


Procurement can be a lengthy process and, because it involves the transfer of money, including fund availability and potentially currency exchange issues, it needs to be planned carefully and often well in advance of the actual activities. A procurement plan is the same as a supply plan, but it includes more information. The supply plan as a final output from the quantification exercise provides critical inputs to the procurement plan. The information generated from the procurement plan, includes the required shipment quantities, with a schedule of each desired delivery date. The procurement plan also includes the identification of the procurement method to be used, a list of the key steps in the procurement process (such as advertise bid, open bid, evaluate bid, award contract, disburse payments, etc.), and a timeline with estimated dates for completing each step of the process, including the names of the responsible parties. Like the supply plan, the procurement plan should be started 24–36 months ahead, and be updated regularly (i.e., rolling procurement plan). The rolling part represents the cyclical nature of procurement of health products—rarely is it a one-time activity, but rather a cycle that will be repeated at regular intervals. This process also ensures that all steps and timelines are accounted for to ensure that the right products, in the right quantities; reach at the right time, in the right condition, at the right price, and at the right place. The procurement unit or the logistics management unit consists of a plan; they share it with other stakeholders, as needed. It clearly states timelines, dates, and responsibilities assigned for each activity. Dates for completion should be set for all activities; but they must be realistic, based on past experience and current capacity. They should include dates all the way through to product delivery and payment schedules to ensure on-going procurement planning (to ensure continuous availability). Knowledge of when stock will arrive will help determine when the next order needs to be placed. Procurement methods typically include competitive bidding, requests for quotations, sole-source procurement, and shopping. The procurement method consists of different tasks, so each procurement will have its own timeline. If possible, think about longer-term contract options to increase the competitiveness of bids—including framework contracts. However, certain countries have regulations that limit their ability to enter into long-term agreements with suppliers.