$10k - $80k

Standing offer arrangements (panels) are set up by entities for frequently sourced goods or services. To maximise competition, officials should, where possible, approach multiple suppliers on a standing offer.

The benefits in using a standing offer are:

• a competitive process has already been undertaken and suitable suppliers have been identified
• contract terms and rates have already been agreed
• entities may be able to use panels that have been set up by other entities which provide efficiencies to both purchaser and supplier.

► Review standing offer arrangements to see if there is a standing offer that suits your requirements.

If you find a standing offer, do not continue with this $10k - $80k process. Follow the Using an Existing Standing Offer process.

You will need to identify who can provide the required goods or services.

Consider:

• Are there many suppliers in the market or is it quite limited?
• Are these goods/services available off the shelf or do they require customisation?

Thinking about these things will assist you in defining your requirements and in deciding how many suppliers to approach.

► Investigate the market – use the internet to look for potential suppliers and/or look at AusTender to find similar procurements.

► Define your requirements in a way that can be easily understood by potential suppliers. If your requirements are more complex, such as:

• you are not sure who can provide the goods/services
• you are not sure exactly what the service involves or what is the best approach
• you are not sure what the suppliers can offer
• consider using terms that specify performance and/or functional requirements. Try to define the steps or processes that you think would be part of the service. This will help suppliers to understand what you think is involved.

► Decide who you would like to approach.

For procurements up to $80k you have the flexibility to directly approach one or several potential suppliers. Keeping in mind that your procurement process (and the time and effort required) should be commensurate with the scale and scope of the business requirement, you will need to justify that the approach and expected outcome represents value for money.

If your requirement is simple, you may decide to approach only one supplier. If you are not familiar with either the market or the requirement, you may decide to go out to more suppliers to test what might be available.

If your requirement is more complex, as described above, you may find the following helpful:

• develop a more formal procurement plan (see CCS Procurement Plan)
• develop a formal approach to market (see CCS Approach to Market)
• consider using a purchase order or contract.

If your requirement is very complex or has a high-risk profile, you may wish to use the $80k-$200k process that provides a more rigourous process and further considerations, noting that you are still not required to approached the market through open tender even though following the more complex process.

Before you go out to market you need to gain your delegate’s agreement that the proposed approach is right for this requirement.

► Discuss your procurement with the delegate; confirm the scope, that funding is available, and details of the approach to market.

► Record in-principle approval to proceed.

The delegate is likely to consider the following:

• expected cost and whether unallocated funds are available.
• the risk profile and risk management strategies if required.
• any potential conflicts of Interest (see APSC policy).
• how you are going to approach the market.

The CCS Procurement Plan provides details of other potential issues which may be useful.

When going out to potential suppliers, you MUST ensure that your approach is consistent and equitable to all potential suppliers.

► Use the approach to market that the delegate agreed to in Step 3: Obtain delegate endorsement to approach the market (ATM).

► If approaching multiple potential suppliers ensure you provide equal conditions and information (e.g. create an email template to send to each supplier or script your phone calls). For email ATMs it is appropriate to attach the CCS ATM terms (see RMG No. 420). Alternatively, you may choose to use AusTender to undertake a limited approach.

► If you require a purchase order or contract, attach the mandated Commonwealth terms (purchase order or contract terms) when seeking a quote. Not all requirements will need a formal approach to market and/or contract (see RMG No. 420). This is dependent on the complexity and risk profile of your procurement.

► If you receive questions from potential suppliers while out to quote, answer them promptly. If any questions result in new information relating to the scope of the procurement you will need to provide the question and answer to all suppliers, without identifying the source of the question.

In order to decide which quote to accept, you will need to evaluate each of the supplier responses and make an assessment about which one represents the best value for money (VFM) to the Commonwealth. VFM is a combination of all relevant financial and non-financial costs and the anticipated benefits of each response.

If only one quote is received:

► evaluate whether the quote meets your requirement and is priced appropriately. This will form the basis of your VFM justification.

If multiple quotes are received, consider:

► which quote best meets your requirement (e.g. quality, fit for purpose, delivery times etc.).

► which quote represents the best price relative to their ability to meet your requirements (value for money of VFM).

► if you included evaluation criteria when you requested your quote then you MUST evaluate all responses against those criteria (the criteria for evaluating responses is clearly set out in the Commonwealth ATM Terms Clause A.B.5 – Evaluation.

► you may want to use the CCS Tender Evaluation Report to guide your process.

If no quotations were received or do not represent VFM, you will need to refine your procurement requirements and go back to Step 2: Plan your procurement.

In accordance with RMG No. 420 you MUST use CCS Contract Terms unless you meet any of the conditions in RMG No. 420 Part 2. 

Sometimes a supplier’s terms will include a ‘contingent liabilities’ clause. A contingent liability is a potential liability that may occur depending on the outcome of an uncertain future event (see RMG No. 414). These are often found with venue hire, software licensing, product warranty and when you click on the ‘I agree’ to online terms and conditions.

► Check the supplier’s terms and conditions for contingent liabilities. If this clause is included, or you are unsure, seek advice from your central procurement area or in-house legal advisors.

► Seek written delegate approval for any contingent liabilities. This approval may be combined with next Step 7: Obtain Delegate Approval under PGPA Section 23.

Once you have completed your evaluation and before entering an agreement, you MUST seek approval under section 23 of the Public Governance Performance and Accountability Act 2013 (PGPA Act).

► Seek the delegate’s agreement to the recommendations resulting from Step 5: Evaluate Supplier Responses.

► Draft your approval minute (if you have used the CCS Evaluation Report this will generate automatically). Alternatively, this may be in the form of an email.

► Prepare a draft purchase order or contract if required. If a formal contract is required you MUST use the Commonwealth Contracting Suite (CCS) unless your procurement meets any of the conditions outlined in RMG No. 420 part 2.

► Provide approval email or minute to delegate for approval. Include the draft purchase order or contract if applicable.

Once relevant approvals have been obtained, you can finalise the placing of your order. This may be done by one of the following:

► accept the supplier's quote - this may be done verbally or by email (if done verbally you should record this in some form).

OR

► place a purchase order - the supplier is then required to accept the purchase order (an email will be sufficient). Ensure that you attach a copy of the Commonwealth Purchase Order Terms.

OR

► send a copy of the contract to the supplier - the supplier is required to return a signed copy of the contract (either physically or electronically). The Commonwealth is then required to sign and return a signed copy of the contract to the supplier.

► after the contract (including purchase orders or quote acceptance) has been formalised, enter this procurement into your entity's Financial Management Information System (FMIS). (You may also be required to submit relevant documentation).

► entities MUST report contracts (including purchase orders or quote acceptance) on AusTender within 42 days of entering into a contract (see CPRs 7.18). Your FMIS may facilitate this reporting or you may have to do this manually. Check with your CFO or your central procurement area.

Once the procurement has been finalised, you MUST notify any unsuccessful suppliers that provided quotes.

► You MUST notify the unsuccessful supplier(s). Notifying unsuccessful supplier(s) in writing (an email may be sufficient) provides a record of notification.

► You MUST offer all suppliers (including the successful supplier) the opportunity to receive feedback on their offer.

You are required to retain all relevant documents in accordance with the Archives Act 1983. Relevant documents include any documents that record decisions and/or approvals, including those with signatures.

► File documents in accordance with your entity's records management practices.

► Manage the contract. More information can be found in the Australian Government Contract Management Guide on the Department of Finance website.