• Free Manual For Procurement Officer

Title: Purchasing Users Manual Policy Owner: Purchasing Office Applies to: Faculty, Staff, Others Campus Applicability: Storrs and Regionals Effective Date: January 20, 2004 For More Information, Contact Purchasing Office Contact Information: (860) 486-2619 Official Website: Foreword The University of Connecticut Purchasing Department is a service unit established to support the educational and research missions of the University. Procurement professionals who have the requisite knowledge, skills and training to assist University personnel in the purchase of required goods and services staff it.

This expertise insures that procurement decisions will be made in the best interest of the University and in compliance with Connecticut state statutes and University policies. This User’s Purchasing Guide contains information regarding the basic policies and procedures to be followed for procurement at the University of Connecticut.

It provides guidance in purchasing transactions and offers useful information about how the purchasing process works in general. The Purchasing Department recognizes that faculty or staff may have questions or concerns regarding the procurement process, which are not answered in this manual. All such inquiries are welcome. If convenient to all parties, we would be pleased to moderate a departmental meeting to discuss our goals and objectives, answer questions and discuss any specific concerns. To arrange a meeting or place an inquiry by phone, please do not hesitate to contact the Purchasing Department at 486-2619. Introduction The purchasing procedures and guidelines presented in this manual have been developed in accordance with Connecticut state statutes and University policies. As a public institution, we are required to follow these regulations in the conduct of our dayA- to A-day business.

Scope of Purchasing Each employee plays an active role in the purchasing function. Many of us requisition goods and services, while others are directly involved in the purchase of goods and services. Most of what we use in our daily work, from the paper we write on to the wax on the floors, has been acquired through Purchasing. Since everyone is involved in purchasing, the Purchasing Department has issued this manual to clarify what is expected of each of us in the purchase of goods and services.

Purpose of the Purchasing Guide This manual should be used as a guide by all employees, when requisitioning, purchasing, receiving, or approving, payment for goods and services. Included in this manual are statements of purchasing policies and objectives, responsibilities of various individuals and departments, and procedures for the performance of some of the major purchasing functions. Maintenance of Purchasing Guide From time to time, revised and/or additional procedures may be released by the Director of Procurement and Logistical Services for addition to this manual.

Therefore, this manual has been issued with a threeA- ring binder to facilitate replacement and/or insertion of additional pages as necessary. GENERAL PURCHASING INFORMATION 1.1 Purchasing Policies and Objectives 1.1.1 General Policy Statement The University of Connecticut Purchasing Department is committed to serving the University community with the timely and cost effective procurement of goods and services. This is accomplished through product knowledge, competitive bidding, negotiation of special pricing agreements and contracts, and monitoring vendor performance.

All of these serve to maximize the University’s purchasing power. 1.1.2 Purchasing Objectives The primary objective of the Purchasing Department is to buy goods and services of the right quality, in the right quantity, at the right price, from the right source, and at the right time. The responsibilities associated with these objectives are: 1. To develop and maintain sources of supply for all goods and services capable of meeting the University’s needs; 2.

To maintain and promote compatible business relations with vendors and the community in general; 3. To foster harmonious working relations between the Purchasing Department and other University departments; 4.

To recommend to potential users any new products and/or services, or new uses for old products and services, that may aid the users in the performance of their duties; 5. To apprise relevant University customers of market conditions and trends that may impact prices and/or availability of the goods and services they purchase; 6.

To periodically review University purchases to assure user needs are being optimally met by the goods and services purchased; 7. To insure all purchases are made in accordance with prevailing statutes, regulations, policies and procedures. 1.2 Purchasing Authority 1.2.1 The 1991 legislative session granted the University greater autonomy over its purchasing operations via passage of Public Act 91A-256.

As approved by the Board of Trustees, under authority of the Act, and as amended by PA 99-161, the basic purchasing policies are as follows: 1. Purchases of goods and services with an estimated total value of $10,000. or less will not require competitive bidding. Departments can expedite the procurement process by providing a written quotation with their purchase requisition.

(Purchasing reserves the option to competitively bid when it is in the best interest of the University.) 2. With the exception of federally funded purchases, purchases of goods and services with an estimated total value exceeding $10,000 but less than $50,000, and are not available on preexisting State or University contracts or sole source agreements, shall be based on at least three (3) competitive bids whenever possible.Exception to the $10,000 threshold: Federally funded purchases require competition for purchases exceeding $2,500. Purchases of goods and services with an estimated total value exceeding $50,000 must be publicly advertised and competitively bid.

For federally funded purchases, the initial threshold is $25,000. When the purchase of goods and services exceeds $50,000, public advertising is an additional requirement.

The bids must be advertised for no less than twenty-one (21) calendar days and have been published in a minimum of two daily newspapers and on the Purchasing Department’s Web site. However; the advertising period can be shortened in some special circumstances.

In general, Purchasing allows twenty-one (21) calendar days for the bid process (from the time bids are mailed to the date bids are opened). However, depending on the complexity of the acquisition, some solicitations may take longer. 1.2.2 The Board has also authorized the University to purchase supplies, materials, equipment and contractual services through negotiation (nonA-competitive purchases) in lieu of soliciting competitive bids when all the following criteria are met: 1. Such purchases are required to implement a Federal grant, contract or financial agreement between the University and the donor wherein funds or other things of value are given with an obligation for service primarily to the donor by the University, and/or, 2. Such supplies, materials, equipment or contractual services are specified in such grant, contract or financial agreement, and/or other 3.

Sole source criteria have been met. (See section 2.1.2.c for details.) 1.2.3 Goods and services available under existing State Contracts may be purchased from the State contract vendors in accordance with the terms and conditions set forth therein. However, the University is not required to utilize State contracts. 1.2.4 The Director of Procurement & Logistical Services may establish University contracts for frequently ordered goods and services, or convenience contracts. A convenience contract is one wherein the primary consideration is convenience rather than price.

Criteria to be used in approving such contracts will include travel time, administrative cost savings, product application and availability. 1.3 Financial Records System (FRS) In October 1990, the Purchasing Department implemented the Purchasing Module of the Financial Records System (FRS).

FRS dramatically reduces the amount of paperwork required by end users, purchasing agents and accounts payable personnel. Some of its advantages to you, the requisitioner, are: Instant onA-line access to information regarding disposition of purchase requisitions, bid status, purchase order status, receiving information, and vendor payments; Reduced administrative and clerical workloads through the automation of many functions, i.e., preparation of purchase requisitions, and completing receiving reports; Simplification of processing requirements, which shortens the procurement cycle. Training is available from the Purchasing Department for User/Departmental onA-line entry of Purchase Requisition and Receiving Reports.

Manuals are provided for these functions at the time of training. 1.4 Commodity Assignments For current commodity assignments see the Purchasing Department website: 1.5 Set Aside, Minority and/or Women Owned Businesses The Purchasing Department currently operates under existing State statutes and procedures promulgated by the Commission on Human Rights and Opportunities and the Department of Economic Development. Under those statutes and procedures, no cost preference is given to set aside, minority or woman owned business enterprises. The Purchasing Department is committed to promoting utilization of set aside, minority and woman owned business enterprises in the University’s procurement programs. The Director of Procurement and Logistical Services or designee is authorized to: 1) change the source on any requisition in order to direct University purchases to minority and woman owned businesses, and 2) designate specific purchases for the exclusive participation by minority and woman owned businesses. 1.6 Contacting and Dealing with Vendors Vendor representatives can be a valuable source of information for products and services.

However, it is in the best interest of the University to assure that all vendors are treated in a fair and impartial manner, and to avoid favoritism and conflict of interest. To assist you in dealing with vendor representatives, the following guidelines are suggested: 1. Contact the appropriate Purchasing Agent or Purchasing Assistant in advance to save time with your purchase.

S/he may be able to provide names, addresses and/or phone numbers of vendors, and existing contracts offering the goods or services required. S/he can also assist in developing a procurement plan. Plan to discuss your need with more than one vendor. Information gathering may reveal alternatives or data not previously discovered. All vendors should be given the same information so each has an equal opportunity to compete.

Not providing equal information can be construed as showing favoritism or misrepresentation. Recognize that permanent business relations can be maintained only on a structure of honesty and fair dealings. Difficult economic times also promote a litigious environment.

Failure to treat all vendors equitably may result in protests, which can delay the procurement process. Discuss all aspects of the need: i.e., what happens after the department owns the purchase.

Consider the life cycle approach, which includes: length of warranty, cost of maintenance, supplies, training, repair costs after warranty, and/or response time required for repair. The cost of the equipment or good may be insignificant compared to these “hidden” costs over the life of the product.

Guard against overreaction to a vendor created crisis: “Price goes up after the first of the month” or “This is the last one in stock”. Unsolicited telephone sales should be ignored or referred to the Purchasing Department. Such items have often been found to be overpriced and of inferior quality. Conduct all business dealings in an impartial and ethical manner. Never accept gifts, gratuities or payments of any kind, including luncheon or dinner engagements or event tickets. Do not commit the University by telling a salesperson he or she has the order.

Only an authorized Purchasing designee may sign and approve purchases from vendors. If you enter into an agreement without the proper authority, you may be held personally liable for payment under Connecticut law. Any equipment on loan from a vendor for testing and/or evaluation requires completion of a University Equipment Loan Agreement to avoid personal liability under Connecticut law.

(See Section 2.6 for details.) 1.7 Ethics and Conflict of Interestb The University of Connecticut is a public trust. Therefore it is our policy to maintain high standards of honesty, integrity, impartiality, courtesy and conduct. Such policy is implemented by prescribing essential standards of ethical conduct without creating unnecessary obstacles. To maintain these standards, the Purchasing Department subscribes to the following principles in the procurement of goods and services. It is essential that anyone conducting business with a vendor also observe the ethical standards described herein.

To give first consideration to the objectives and policies of the University of Connecticut. To strive to obtain the maximum ultimate value for each dollar of expenditure. To recognize that value represents the combination of quality, service and price, assuring the greatest ultimate economy to the user. To demand honesty in sales representation, whether offered through the medium of a verbal or written statement, an advertisement or a sample of the product.

To grant all competitive bidders equal consideration; to regard each transaction on its own merits; to foster and promote fair, ethical and legal trade practices. To discharge our duties impartially to assure fair competitive access to procurement from the University of Connecticut by responsible contractors. To respect obligations and neither expressly nor implicitly to promise a performance that cannot reasonably be fulfilled. To decline all personal gifts or gratuities. To make every reasonable effort to negotiate an equitable and mutually agreeable settlement of any controversy with a supplier; and/or be willing to submit any major controversies to a third party review, insofar as the established policies of the University of Connecticut permit. It shall be a breach of ethical standards for any employee or agent acting in behalf of the University of Connecticut: To solicit, demand, accept or agree to accept a gratuity or any offer in connection with any decision, approval, disapproval, recommendation or preparation of a purchase request.

To unduly influence the content of any specification or procurement standard. To agree to retain a person, solicit or secure a contract upon an agreement or understanding for a commission, percentage, brokerage or contingent fee. To knowingly use confidential information for actual or anticipated personal gain or for the actual or anticipated personal gain of any other person. All University employees should be aware that unethical conduct may involve a breach of state law, punishable by fine and/or incarceration. 1.8 How You Can Help As outlined in the Introduction, each employee plays an active role in the purchasing function. To assist the Purchasing Agents in expediting your requests, we offer the following suggestions: Identify those areas where you can plan ahead for procurement, thereby allowing us to plan our workload. The more time Purchasing and the vendor have to process an order, the better job we can do for you.

Provide all available information with your requisition (See Section 2.1 A- Initiating a Purchase Requisition). Submit an accurate description of the product as it will be shipped and invoiced. Many orders are not invoiced in the same unit of measure as ordered. Notify Purchasing immediately if a duplicate shipment has been received and whether or not you intend to keep it. Submit the appropriate paperwork required to amend the original order or return the duplicate shipment. (See Section 2.5 A- Returned Goods Procedures) Do not add additional items to an established order without authorization from the appropriate Purchasing Agent.

Doing so delays vendor payments, thereby jeopardizing supplier goodwill. If special conies are received (e.g., bond or grant funds) from which extra procurement will be made, apprise the appropriate Purchasing Agent so s/he may be prepared to administer the increased volume. Add recommended vendors to the Purchase Requisition including name of company, representative, address, telephone number and Federal Employer Identification number (FEIN), if known. GENERAL PROCESSING INFORMATION 2.1 Initiating a Purchase via Purchase Requisition (PR) 2.1.1 The first step is to determine exactly what your needs are and what functions you want the item and/or vendor to perform. It is equally important to allow enough time for the entire purchasing process to unfold.

This process includes preparing the requisition and obtaining authorized approvals, processing in the Purchasing Department, mail time and delivery. Depending on what is ordered, the entire transaction could be completed in days or months. The initial action required is preparation of a purchase requisition.

Departments must enter their requests on-line in FRS, which results in the printing of the Electronic Requisition Form No. You can expedite your request by supplying the following information: 1. The date the requisition is prepared as well as the date material is required.

Requisitions with a specific delivery date will be given priority over those with missing or indefinite delivery requirements, i.e., “ASAP”. Use “RUSH” as defined in section 2.2.B. When imputing the PR, include the Delivery Code number, department name and address. The requestor’s name and phone extension should also be provided, in the event the purchasing agent needs clarification on requested items.

Many people use the terms purchasing and procurement interchangeably, but despite their similarities, they do have different meanings. Let’s clarify any confusion on the difference between procurement and purchasing. Procurement involves the process of selecting vendors, establishing payment terms, strategic vetting, selection, the negotiation of contracts and actual purchasing of goods. Procurement is concerned with acquiring (procuring) all of the goods, services, and work that is vital to an organization. Procurement is, essentially, the overarching or umbrella term within which purchasing can be found. The Importance of Strategy Because procurement is an umbrella term that includes several core business functions it should be considered a core part of any organization’s corporate strategy.

Our friends at have published a great explanation of 4 aspects of corporate strategy. Those aspects are: Company Identity, Market Placement, Company Capabilities, and Management Issues.

Company Identity. What does our company do and stand for?. What beliefs inform our business model?

Market Placement:. Who are our customers?. What do they want?. What do they believe in? Company Capabilities:. What are our strengths and weaknesses?.

Do our strengths support our long-term goals?. How do we want to grow?

Management Issues:. Do we need to hire/develop talent to lead us to our goals?. Does the company have the resources needed to achieve our goals? We like this breakdown because procurement touches each of these components. For instance, procurement and company identity can be intertwined. If your business is building (or has built) its identity around an environmentally conscious ethic, then your procurement strategy should reflect that decision. Policies should be in place to ensure you are sourcing from companies with similar ethics, or that you are sourcing materials that are not environmentally hazardous.

Your market placement should reflect your branding. Customers are without a doubt, attracted to the philosophies and practices a business uses, and often seek companies whose values reflect their own. Your company’s capabilities and management issues should also reflect that branding. You must have the right people in place to put into action the beliefs/philosophies you want your business to be governed. Steps in the Procurement Process Aligning your procurement function with your corporate strategy is only one part of the ultimate goal of procurement. Goods and services also need to be purchased. The process of purchasing these good and services is known as the.

The entire Procure-To-Pay Cycle can be an involved process with numerous steps:. Identification of Requirement. Authorization of Purchase Request. Approval of Purchase Request. Procurement. Identification of Suppliers.

InquiriesReceipt of the Quotation. Negotiation. Selection of the Vendor. Purchase Order Acknowledgement. Advance Shipment Notice. Goods Receipt. Invoice Recording.

3 Way Match. Payment to Supplier Although this list is extensive, the nature of your specific business will determine the extent of the Procure-To-Pay cycle you use. For example, if your work in a large, multinational corporation, you may have to undergo a more involved “Identification of Requirement” phase. On the other hand, if you work in a small firm, that stage may be quick and simple. Understand the scope of your business and tailor as needed. Using purchase orders (especially those generated by an solution such as ) is critical, regardless of the size of your organization.

Don’t simply use your credits card(s) and save the receipts. Don’t rely on emails which are hard to track. The Purchasing Process Purchasing is a subset of procurement. Purchasing generally refers simply to buying goods or services.

Purchasing often includes receiving and payment as well. Within the overarching Procure-To-Pay Cycle, the steps specifically related to purchasing are:. Purchase Order Acknowledgement. Advance Shipment Notice. Goods Receipt.

Free Manual For Procurement Officer

Invoice Recording. 3 Way Match.

Payment to Supplier Unlike the entire Procure-To-Pay Cycle, the steps explicitly related to purchasing should not be tailored to suit the size and scope of each individual business. These are fundamental steps of good purchasing and should be employed routinely as a best practice in all businesses. Conclusion Because purchasing is a process within the overarching procurement process, both procurement and purchasing are often used interchangeably. In the business world, the practice of using similar terminology in either conversation or printed materials is routine, although it is often confusing and should be avoided. Procurement deals with the sourcing activities, negotiation and strategic selection of goods and services that are usually of importance to an organization. Purchasing is the process of how goods and services are ordered.

Purchasing can usually be described as the transactional function of procurement for goods or services. Hi Chad, Yes, it would be the Procurement Manager’s job to find the best quality products at the best price, with vendors that fit the needs of your organization. It’s important for your Procurement Manager to have requirements on products and as well as supplier relationship. For example, what are their requirements when it comes to purchasing items ie.

How long it takes for an order to get there, the condition of the product when it arrives, the quality to price ratio, etc. Hope this helps!

Commercial material acquisition activity of the 1950’s and earlier years with its focus on ” three bids and the lowest price” was known as Purchasing. Later this function evolved into “Procurement Service” in defense and public sector in the 1960’s. World class industrial corporations adopted the term in early 1970’s with organizational focus on “total cost of ownership” (TCO), covering several activities from demand determination to supplier selection and negotiation of contracts to ensure uninterrupted supply line. Some point in time, “procurement” will be absorbed into the umbrella function of “supply chain management”.