Often procurement doesn't get the attention it deserves, but there can be frightening consequences if clubs don't take the time to follow this important process.

All clubs have a requirements for purchasing goods and services.  The complexity of this process depends on the intricacy of the product or services being acquired and the values assigned to them respectively.

Where the value of the procurement contract reaches a higher threshold - as determined in the club's procurement policy - the club has a range of procurement process options available including: requests for information (RFI); pre-qualified approved suppliers; multi-use lists; expressions of interest (EOI); and requests for tender (RFT).

Request for Information (RFI)

Expression of interests should be used to compensate for a lack of understanding as to a club's needs.  If a club is uncertain as to what it requires, it should undertake a simple request for information.  A request for information may be undertaken to determine available technologies, products or services in the market place that meet the club's needs; whether proposed terms and conditions or deliverable expectations are acceptable in the market place; and whether proposed club budgets are adequate to meet non-standard procurement needs.

A club should use a request for information rather than a request for tender or expression of interest to improve its understanding of its own needs, ideas, availability and likely costs.

Pre-qualified panel suppliers

Tenders are invited from a pre-approved list of tenderers who are known to have the ability to meet the needs of the club.  Many clubs have arrangements with panels of suppliers of goods and services required on a regular basis, but where the timing and quantities were not pre-determined when the panel was established.

A panel is defined as an arrangement under which a number of suppliers, usually selected through a single procurement process or tender, may each supply goods or services.  The club would have previously agreed documentation including an indicative or set price chart that applies when goods or services are purchased.

The club can then seek quotes and purchase from any supplier on the panel.  It provides quick and easy access to goods and services without requiring the club to go through the requirements of a tender process for every acquisition.  Some common examples where clubs acquire goods and services under standing offers include printing supplies, recruitment services, professional services and building maintenance.

For each panel procurement, the club needs to ensure there is sufficient documentation to provide an understanding of the reasons for the procurement, the process that was followed and all relevant decisions including approvals, authorisations, and the basis of the decisions - including the reason for choosing a particular panel supplier.  This documentation need not to be onerous, but include the supplier's fitness for purpose, price relative to ther panel suppliers and quality of product.  The club, in their own procurement policy, should outline detailed instructions and policies for establishing and managing standard offers and panels.

Multi-use lists

Standing offers and panels need to be distinguished for multi-use lists. 

A multi-use list is a list of pre-qualified suppliers who have satisfied specified conditions for inclusion on the list and are intended for use in more than one procurement process.

In circumstances where the club requires goods or services on a recurring basis, multi-use lists can be useful.  Inclusion on a multi-use list may be used either as an essential criterion, as a condition for participation in an open tender, or as the basis for approaching participants in a select tender process.

All contractors that satisfy the conditions for inclusion on a multi-use list represent a pre-qualification for participation in a procurement selection process, but are not a procurement selection process in itself.  In most cases a separate written contract will need to be developed as part of the procurement approach, or after the supplier has been chosen on a merit basis.  Most acquiring entities will have a set of standard contracts that can be drawn upon in the contract development process.

Expression of interest (EOI)

An expression of interest process does not replace the need to call for tenders but seeks an indication of interest from providers.  It precedes the calling of tenders and generally seeks to constrain the number of tenders received and their quality and detail.  EOI is used to shortlist potential suppliers of goods and services.  The process generally comprises an overview of the requirements, an invitation to submit an EOI, criteria for evaluation the EOI and a respondent's form.

An EOI should be used in circumstances where there is likely to be many tenders, tendering will be costly or the procurement is complex, or if a club does not wish to impose the costs of preparing full tenders on a large number of potential tenderers.  An EOI is also helpful if the club is seeking information on the capability and number of potential service providers or if there is uncertainty as to the interest of suppliers in offering potential products or services to undertake proposed works.

Request for Tenders

A request for tender is the primary vehicle for seeking competitive bids from prospective suppliers for goods and services where the club's cost thresholds have been reached - that is, the contract is above a certain value as determined by the club's procurement policy - or where the need is unique and complex in nature.  Tenders can be either open or selective.  Clubs can invite open tenders by public advertisement without any restriction on the number of tenders received.  Tenderers are required to demonstrate they have the right product or services and the necessary skills, resources, management practices and financial capacity to meet the club's requirements.

Clubs with a continuous program of works can also select a limited number of tenderers from a register of approved tenderers.  If the club is undertaking a formal tender, it should have in place the necessary documentation as well as the exact specifications and quantities of goods or services required.  The documents sent to each prospective supplier are developed in the contract and procurement planning stage.

It is important to remember that the quality of the documentation provided to potential suppliers will, in part, determine the quality of their submissions or tenders.

(SOURCE: Debbie Organ, ClubsNSW Learning & Development Executive, ClubLIFE June 2017)