Purchasing at McMaster

1. Purchasing at McMaster Purchasing Resources 2011

2. Topics: • Purchasing Resources Overview • New Legislative Requirements • Current Public Procurement Environment • Acquiring Goods & Services • Sole/Single Sourcing • Request for Proposals (RFP’s) • Purchasing Requisition • Customs & Traffic

3. “Purchasing Resources” Assistant Vice-President (Administration) Financial Services Purchasing Resources Treasury Operations Accounts Payable Travel Customs & Traffic Purchasing Services Mail Services Stores ABB & HSc

4. Purchasing Resources • www.mcmaster.ca/bms/BMS_Purchasing Resouces.htm • Mission: • Supply management through value-added services.

5. Founding Principles re Procurement • Agreement on Internal Trade (Chapter 5) • Ontario/Quebec Trade Agreement • Bill 122 – Procurement Directive • Ontario Gov’t Supply Chain Guidelines • Laws of Competitive Bidding

6. Funding Agencies • CFI • Must follow institution’s purchasing policies • Must follow AIT • Must follow CFI Guidelines http://www.innovation.ca/en/programs/cfi-policy-and-program-guide

7. Funding Agencies • Tri-Council • Must follow institution’s purchasing policies • Must follow AIT • In accordance with Tri-Agencies’ Policies, Regulations and Guidelines • Eligibility • Compliance • Approval – Grantee or Delegate

8. How to Acquire Goods & Services • How much is the purchase? • Are approvals required beyond your unit? • i.e. IT (CIO’s office), Research (Research/Finance) • Note: Approvals are SIGNATURES

9. How to Acquire Goods & Services • Should the purchase be bundled with other purchases? • Must consider the full payment over the term of the contract i.e. 2 year engagement • Application forms the basis of the budget. Once funds received, purchasing policy must be followed.

10. How to Acquire Goods & Services • Goods less than $2,500 • Item secured by end user via • Systems Contract Supplier; e.g. Grand and Toy • Departmental Acquisition Card • Invoice payable by Cheque Requisition

11. How to Acquire Goods & Services • Goods > $2,500 & < $10,000 • 1 quotation secured by end user • Requisition for purchase to be sent to Purchasing Services Goods > $10,000 & < $50,000 • 3 (new April 1, 2011) quotations secured by Requisitioner or Purchasing Services • Requisition for purchase to be sent to Purchasing Services

12. How to Acquire Goods & Services • Goods > $50,000 • Formal bidding required through Request for Proposal (RFP) Goods > $100,000 • Formal bidding required through Request for Proposal (RFP) • Posted on MERX

13. Exception: Sole/Single Source • Sole Source: • Only supplier due to proprietary rights • Single Source: • Multiple suppliers available but rationale for single sourcing

14. Exception: Sole/Single Source • Use: Sole/Single Source Certificate • http://www.mcmaster.ca/bms/forms/sole%20source.pdf • Requester initiates completion of form at beginning of procurement cycle • Attach quotes, if applicable • Select reason for sole/single sourcing • Complete “rationale” supporting sole/single sourcing • Obtain approval

15. Exception: Sole/Single Source • Prior Approval Required by: • Requester • Account Holder • 1 Level Higher than Account Holder i.e. Chair • Director of Purchasing Resources

16. Exception: Sole/Single Source • Effective April 1, 2011 re Consultants • “Consultant” means a person or entity that under an agreement, other than an employment agreement, under a fee-for-service arrangement, provides expert or strategic advice and related services for consideration and decision-making, usually in the form of a report.

17. Exception: Sole/Single Source • “Contractor/Professional Service” is a person or entity retained under a fee-for-service arrangement, that is not an employment agreement, to perform specific tasks under a client’s direction for a limited period of time.

18. Exception: Sole/Single Source • Effective April 1, 2011 re Consultants • All consulting services must be bid regardless of dollar value. • For non-competitive, in accordance with AIT exemptions only, approvals are: $0-999,999 President >$999,999 Board of Governors

19. Terms and Conditions to Consider • Life cycle costing • Consumables • Sustainability • Acceptance testing • Warranty • Training • Post warranty maintenance costs • Payment terms • Payment tied to deliverables • Delivery timeframe (work backwards from date needed) NOTE: Do not sign supplier’s quotations/proposals/agreements

20. Low Bid • Low bid ≠ Award • Best Value = Award • (high score wins)

21. Request for Proposals (RFP) • Standard Sections • Section 1 – Purpose & Content (Some customization) • Section 2 – Instruction to Bidders • Section 3 – Evaluation & Award • *** >$100,000 – must add evaluation criteria • Section 4 – Award Contract • Section 7 – Purchase Order T’s & C’s • Section 10 – Mailing Label

22. Evaluation Methodology • >$100k must have weighted criteria • Example: • Total Acquisition Cost 40% • Technical Evaluation 19% • Ability to Deliver Services 19% • Bidder’s Methodology to assist Community Partners convert/transform to a different platform from current 10% • Sustainability Goals 7% • Ability to provide all groupings 5%

23. Request for Proposals (RFP) • Customization Required • Section 5 – Special Terms and Conditions • Section 6 – Functional Requirements • Section 8 – Request for Proposal CFI Submission Format • Section 9 – Summary Proposal Form • ***may add as many sections as needed in order to customize

24. Request for Proposals (RFP) • Timing • Allow 2 weeks for review and finalization • MERX Posting – minimum 15 calendar days **** strongly recommend 3 weeks (15 business days) • NEW April, 2011 – complex RFP’s – 30 days • Allow 2-4 weeks for evaluation • Total Elapsed Time: minimum 7-8 weeks + delivery

25. Request for Proposals (RFP) • Suppliers must obtain RFP from MERX • Formal Closing to Purchasing Resources • Must be signed & received on time in Purchasing Services • All communication is routed through Purchasing Services • Conflict of interest must be followed • Evaluation must be provided to support award • Scoring of suppliers’ proposals must be in accordance with the RFP weighting criteria • Original proposals and purchase orders/contracts are kept in Purchasing Services

26. Request for Proposals (RFP) • How can you help? • Provide supplier list • Provide functional specifications • Explain need for special terms and conditions • Point suppliers to Purchasing Services

27. Purchase Requisition • Purchase Requisition required regardless of dollar value: • Perishables • Radioactive material • Purchases for Health Sciences Centre • P.O. requested by supplier • Purchases from non-Canadian suppliers

28. Purchase Requisition • http://www.mcmaster/ca/univsec/bylaws/BoardBy-laws.pdf • Attach approved Sole/Single Certificate with requisition when seeking approval • Obtain approval to purchase based on “Execution of Instruments: -(By-Laws of the Board of Governors of McMaster University, Appendix E – RESOLUTION RESPECTING THE EXECUTION OF INSTRUMENTS) • Research Finance approves all research purchases • (pre approval >$2,500) • Note: Contracts must be signed by the same levels as the requisition

29. Responsibilities • Customer • Understands department/program’s operations and requirements • Responsible for budget and planning; e.g. determines what equipment and services are needed, when and where • Initiates the purchase in accordance with University policy • Complete thorough evaluation in accordance with RFP • Provides technical expertise Purchasing Services • Responsible for understanding purchasing statutes, rules, policies, procedure and industry best practice • Working with customer to facilitate purchases • Support and advise on best resolution of procurement problems • Must comply with all Provincial, Federal and funding agency requirements

30. Forms • Available at: • http://www.mcmaster.ca/bms/BMS_Forms.htm

31. Customs and Traffic • Clearing and expediting of incoming and outgoing shipments • All U.S. and International orders (including on-line) must be purchased through Purchasing Services to ensure compliance with Customs rulings How can you help? • Respond promptly to queries from the Customs and Traffic department • Ship online using FedEx Ship Manager

32. Commodities

33. HELP! • Accounts Payable: • Telephone: General enquiries x24333 • Fax: 905-572-1015 • Customs and Traffic: • Telephone: x24358 • Fax: 905-529-0433 • Mail Services: • Telephone: x24286 • Fax; 905-540-1039 • Purchasing Services: • Telephone: General enquiries x24413 • Fax: 905-572-1015

34. HELP! • Stores: • ABB Stores: • Telephone: x24668 • Fax: 905-522-0554 • Health Sciences Stores: • Telephone: x22337 • Fax: 905-572-7506 • Travel: • Telephone: x24520 • Fax: 905-572-1015