Introduction
Procurement can be defined as the process of acquisition goods, works and services to satisfy the identified needs of an important function within an entity. Procurement can be defined as the process through which entities purchase their requirements to fulfill school requirements.
The traditional definition of procurement is acquisition by any means of supplies, services, or works. This definition was more associated with purchasing than procurement. We can say that procurement, different purchasing, is a process not an event. It has to be conducted in a systematic manner; and involves a number of stakeholders.
What are the objectives of procurement?
The traditional five (5Rs) rights of procurement, Bailey and Farmer (1985) namely:
- Acquiring the Right product
- From the Right supplier
- In the Right quality
- At the Right time
- At the Right price
Evaluation of bids
An independent assessment of compliance with the requirements stated in bid documents.
The bids have to comply with the statement of requirements, exhibit the ability to perform the proposed contract, and the ability to meet the objectives of the procurement undertaken by the Evaluation Committee (EC), which an ad hoc committee. It is assembled as the need arises. Usually the evaluation committee’s report recommends the best evaluated
Guiding Principles for Evaluation of Bids
The following principles guide the evaluation process:
- All bids to be assessed against the same criteria
- Evaluation criteria to be made known to all bidders in the bid/solicitation documents
- The principle of equitable and fair assessment to be applied in the evaluation of bids
- Evaluation of bids is the responsibility of the Evaluation Committee
Steps in evaluation of bids
There are three key stages in bid evaluation: preliminary bid examination, technical evaluation; and financial evaluation. There result of these processes is the evaluation report which is used by the contracts committee to award.
Preliminary examination:
After the bidding closing date, day and time, the process of evaluation of bids starts. It starts with the preliminary examination of the bids.
Technical evaluation of bids:
Under a competitive bid process, the method used for the evaluation of supplies or works (construction of roads, buildings, etc.) is technical compliance. This method favors a lowest cost or price in terms of the total price of the bid. So the bidder who is technically compliant and has a lowest price will emerge the best evaluated bidder.
Evaluation of services as consultancy services is discussed here. There are six methods that can be used in the evaluation of consultants: Quality and Cost Based Selection (QCBS), Quality Based Selection (QBS), Fixed Budget Selection (FBS), Single Source Selection (SSS), Least Cost Selection (LCS), and Selected Based on the Consultants Qualifications (CQS). These methods are used the same way the World Bank recommends. See the World Bank section for details.
Technical evaluation of bids
Financial evaluation of bids:
Conducted for all those bids that have passed the technical evaluation stage. The process require that the evaluation committee (EC) examines and compares to determine the best evaluated price. The EC will first correct any arithmetic errors, and convert all bids to the single currency that had been stated in the bid documents (it is usually the local currency).
It will also apply any margin of preference as had been stated in the bid documents; and make adjustments for non-material omissions, and finally determine total evaluated price. The best evaluated price does not always have to be the lowest. The bid documents will have explained this.
Combine Technical and financial evaluation:
Once the committee has graded the financial report, it will combine it with the technical report in order to get the best evaluated bid. The combination will be based on a ratio that was stated in the bid documents (for example 70:30; 80:20; 90:10). The firm or bidder with the best marks from the combined documents will become the best evaluated bid. It will be followed the second and the ranking order continues downwards (from top to bottom).
Compilation of an Evaluation Report
At the end of the evaluation process, the evaluation committee will prepare and present an evaluation report to the PDE. The report will indicate the all the processes of the evaluation. It will show the number of bid documents that were picked; the number of applications received before the expiry of the bid; the bids that went past the administrative review; and the best evaluated bid. The ranking order will be used to show the best evaluated bid.
The report will also the procurement method(s) that were used; the evaluation methods that were used; the scoring system where used; the score sheets of all evaluators; the combined score sheet for each bidder; and the ethical code of conduct signed by each evaluators.
The advert (in case open competitive bid) will be attached; and with bid documents. This report will be handed over the PDU for onward submission to the contracts committee via the accounting officer. The contracts committee will either accept or reject the evaluation report.
Best evaluated bid
Under competitive methods, the government requires that the evaluation report should rank the bids according to the rating or scores. The evaluation committee, using the already set out evaluation method stated in the bidding documents, is supposed to rank from the best to the worst rated bid.
The best evaluated bidder will later be offered an award by the contracts committee, when they have approved the evaluation report. The purpose of ranking, among other reasons, is to get a systematic approach for the contracts committee to award fairly. When the best evaluated bidder refuses to accept the offer, then the contracts committee will give the same offer to the next best in the ranking
order.
