DE State Contracts
Transcript of DE State Contracts
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STATE OF DELAWARE STATE OF DELAWARE INFORMATION ON INFORMATION ON
CONTRACTS & PURCHASING CONTRACTS & PURCHASING
PRESENTED BY:PRESENTED BY:SANDRA L. DAVID & SANDRA L. DAVID &
JANET SCHUKOSKEJANET SCHUKOSKE
DIVISION OF SUPPORT DIVISION OF SUPPORT SERVICESSERVICES
OCTOBER 27, 2004OCTOBER 27, 2004
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OVERVIEW FOR TODAYOVERVIEW FOR TODAY
SMALL PURCHASE PROCEDURES/ SMALL PURCHASE PROCEDURES/ THRESHOLD CHANGESTHRESHOLD CHANGES
USER COMMITTEESUSER COMMITTEES CONTRACTING’S NEW ROLECONTRACTING’S NEW ROLE RFP PROCESS & PROCESS CHECKLISTRFP PROCESS & PROCESS CHECKLIST ANSWER/QUESTION TIMEANSWER/QUESTION TIME
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Division of Support Services
Contract Services
Food Services
Surplus Property
Delaware Helpline
Fleet Services
Printing & Publishing
Messenger Services
Fleet link
Commercial Printing
Copy Management
Department of Administrative Services
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THRESHOLD DEFINITIONSTHRESHOLD DEFINITIONS
FORMAL BID:FORMAL BID:
Work must be performed under a Work must be performed under a contract entered into according to contract entered into according to Delaware Law. (Formal Sealed ITB/RFP, Delaware Law. (Formal Sealed ITB/RFP, public advertising in public newspaper public advertising in public newspaper in all three counties).in all three counties).
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PURCHASING THRESHOLDPURCHASING THRESHOLDDEFINITIONSDEFINITIONS
MATERIEL & NON-PROFESSIONAL MATERIEL & NON-PROFESSIONAL SERVICES:SERVICES:
Any material or work of a Any material or work of a nonprofessional nature required by a nonprofessional nature required by a State Agency.State Agency.
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THRESHOLD DEFINITIONSTHRESHOLD DEFINITIONS
OPEN MARKET:OPEN MARKET:
If it’s not on the contract, go buy it.If it’s not on the contract, go buy it.
WRITTEN QUOTES:WRITTEN QUOTES:
Must obtain three written quotes from Must obtain three written quotes from three sources/vendors as to the prices three sources/vendors as to the prices (Can be faxed, electronic mail, and (Can be faxed, electronic mail, and U.S. mail).U.S. mail).
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THRESHOLD DEFINITIONSTHRESHOLD DEFINITIONS
PROFESSIONAL SERVICES:PROFESSIONAL SERVICES:
Any contract for services of a Any contract for services of a professional nature required by a State professional nature required by a State Agency, (Generally requires Agency, (Generally requires specialized education, training or specialized education, training or knowledge, i e. Consultant, Engineers). knowledge, i e. Consultant, Engineers).
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THRESHOLD DEFINITIONSTHRESHOLD DEFINITIONS
PUBLIC WORKS: PUBLIC WORKS:
Any contract for the construction, Any contract for the construction, reconstruction, alteration or repair of reconstruction, alteration or repair of any public building, road street, etc. any public building, road street, etc. (Paid by public funds)(Paid by public funds)
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THRESHOLD DOLLAR THRESHOLD DOLLAR AMOUNTS OF CONTRACTSAMOUNTS OF CONTRACTS
MATERIEL & NON-PROFESSIONAL MATERIEL & NON-PROFESSIONAL SERVICES:SERVICES:
Less than $ 10,000.00 Open Less than $ 10,000.00 Open MarketMarket
$10,000.00 - 24,999.00 Written $10,000.00 - 24,999.00 Written QuotesQuotes
More than $25,000.00 - Formal BidMore than $25,000.00 - Formal Bid
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DOLLAR AMOUNTS CON’TDOLLAR AMOUNTS CON’T
PROFESSIONAL SERVICES:PROFESSIONAL SERVICES:
Less than $50,000.00 Open MarketLess than $50,000.00 Open Market Over $50,000.00 Formal BidOver $50,000.00 Formal Bid
*ALL CONTRACTS ISSUED BY THE *ALL CONTRACTS ISSUED BY THE DIVISION OF SUPPORT SERVICES ARE DIVISION OF SUPPORT SERVICES ARE MANDATORY FOR AGENCIES. MANDATORY FOR AGENCIES. Title 29, Title 29, Section 6902 (f)Section 6902 (f)
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DOLLAR AMOUNTS CON’TDOLLAR AMOUNTS CON’T
PUBLIC WORKS:PUBLIC WORKS:
Less than $25,000.00 Open Less than $25,000.00 Open MarketMarket
$25,000.00 – 49,999.00 Letter Bid$25,000.00 – 49,999.00 Letter Bid
(letter sent for pricing)(letter sent for pricing) Over $50,000.00 Formal BidOver $50,000.00 Formal Bid
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SILVER OAKS PARTNER CONSULTANTS’ SILVER OAKS PARTNER CONSULTANTS’ SOURCING LIST SPEND AND SAVINGSSOURCING LIST SPEND AND SAVINGS
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SOURCING CATEGORIESSOURCING CATEGORIES
UniformsUniforms DefibulatorsDefibulators Network ServicesNetwork Services Janitorial ServicesJanitorial Services Paper (computer)Paper (computer)
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SOURCING CATEGORIES SOURCING CATEGORIES CONTINUEDCONTINUED
CellularCellular Computer HardwareComputer Hardware CopiersCopiers Electrical SuppliesElectrical Supplies FurnitureFurniture
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SOURCING CATEGORIES SOURCING CATEGORIES CONTINUEDCONTINUED
Lab SuppliesLab Supplies Long DistanceLong Distance Office SuppliesOffice Supplies SoftwareSoftware
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SILVER OAKS SOURCING SILVER OAKS SOURCING SPENDSPEND
• DELAWARE SPEND:
• TOTAL FOR FISCAL YEAR 2004 $ 85,424,108
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Silver Oaks ( P2) Cumulative Silver Oaks ( P2) Cumulative Savings BreakoutSavings Breakout
June 2004FY '04 to
Date Total P2 To Date
Executive 473,264 4,162,356 6,459,786 DOT 49,334 447,292 545,703 Schools 82,249 1,041,451 1,394,537 Other 102,094 802,027 1,150,204 Total 706,941 6,453,126 9,550,230
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P 2 SAVINGSP 2 SAVINGS
TOTAL SAVINGS FOR FISCAL YEAR TOTAL SAVINGS FOR FISCAL YEAR 20042004
$ $ 9,550,230
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CONTRACTING’S ROLECONTRACTING’S ROLE
The Contracting Section within the The Contracting Section within the Division of Support Services, manages Division of Support Services, manages all statewide contracts for goods and all statewide contracts for goods and non-professional services.non-professional services.
Manage Agency ContractsManage Agency Contracts Consult and Assist other Agencies with Consult and Assist other Agencies with
their contract needs. their contract needs.
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CONTRACTING ROLE CONTRACTING ROLE CONTINUED CONTINUED
Clearinghouse for information on Clearinghouse for information on central purchasing by two or more central purchasing by two or more organizationsorganizations
Agent for common purchases of Agent for common purchases of supplies or contractual servicessupplies or contractual services
Collector and furnisher of information Collector and furnisher of information on market prices and other data useful on market prices and other data useful in making purchasing decisionsin making purchasing decisions
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CONTRACTING ROLE CONTRACTING ROLE CONTINUEDCONTINUED
Clearinghouse for information on bid Clearinghouse for information on bid for supplies, material or contractual for supplies, material or contractual servicesservices
Perform other services and/or duties Perform other services and/or duties necessary to encourage economical necessary to encourage economical and cost effective methods of and cost effective methods of purchasing by participating purchasing by participating organizationsorganizations
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CONTRACTING ROLE CONTRACTING ROLE CONTINUED CONTINUED
Utilize Agency input into the structure of Utilize Agency input into the structure of contracts by way of contracts by way of User CommitteesUser Committees
Contract specifications and or Contract specifications and or ConsultationsConsultations
Periodic review of Contract VendorPeriodic review of Contract Vendor Life Cycle Costing(SB 307)*Life Cycle Costing(SB 307)* Energy Star *Energy Star * Cost Savings – Negotiations*Cost Savings – Negotiations* Cost Avoidance Technique*Cost Avoidance Technique*
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USER COMMITTEESUSER COMMITTEES
MANDATED BY MANDATED BY DELAWARE LAWDELAWARE LAW
VITAL AND VITAL AND IMPORTANT ASPECT IMPORTANT ASPECT OF OUR QUALITY OF OUR QUALITY CONTROLCONTROL
AND OUR AND OUR CUSTOMER SERVICECUSTOMER SERVICE
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USER COMMITTEES USER COMMITTEES DEVELOPMENTDEVELOPMENT
Develop by SpendDevelop by Spend Top Spend Agencies Top Spend Agencies
participation participation requiredrequired
Procedures initiated Procedures initiated by Contracting by Contracting OfficersOfficers
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USER COMMITTEESUSER COMMITTEES
Agency input into the structure of Agency input into the structure of contracts by way of User Committeescontracts by way of User Committees
Contract specificationsContract specifications Agency review of AwardAgency review of Award Periodic review of Contract VendorPeriodic review of Contract Vendor
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NEW CONTRACTING PROCESSNEW CONTRACTING PROCESS
Contracting New EnhancementsContracting New Enhancements– Analyzing the commodityAnalyzing the commodity
– Selecting a Bidding Approach (only RFPs)Selecting a Bidding Approach (only RFPs)
– Initial Bid Analysis Initial Bid Analysis
– Negotiation StrategyNegotiation Strategy
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Industry and Industry and Supplier AnalysisSupplier Analysis
Objective: Determine how current trends in a given industry.
i. Conduct Industry Analysis ii. Conduct Supplier Analysis
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PRIMARY GOALSPRIMARY GOALS
To understand implications of industry To understand implications of industry trends for sourcing processtrends for sourcing process
To identify key suppliersTo identify key suppliers
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How Benefit is AchievedHow Benefit is Achieved
Improved Quality/Service LevelsImproved Quality/Service Levels• Detailed specification of service levels Detailed specification of service levels
requiredrequired• Willingness of suppliers to meet Willingness of suppliers to meet
requirements to win high-volume requirements to win high-volume businessbusiness
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How Benefit is Achieved How Benefit is Achieved ContinuedContinued
Purchasing of the Right" Purchasing of the Right" Products/ServicesProducts/Services
Development of new product/service Development of new product/service specifications aligned with user needs specifications aligned with user needs
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How Benefit is AchievedHow Benefit is Achieved Continued Continued
Cost ReductionCost Reduction Purchasing the correct product or Purchasing the correct product or
service at the best priceservice at the best price Delivering the best total cost solution Delivering the best total cost solution
to the stateto the state
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How Benefit is Achieved How Benefit is Achieved ContinuedContinued
Better Management of Spending Better Management of Spending and Budgetingand Budgeting
Better understanding of internal Better understanding of internal sources of demand, and ability to sources of demand, and ability to forecast and control spending going forecast and control spending going forwardforward
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Researching Industry and Researching Industry and SuppliersSuppliers
POTENTIAL RESEARCH RESOURCESPOTENTIAL RESEARCH RESOURCES
Reports:Reports:-Industry reports-Industry reports
-Analyst reports-Analyst reports
-Regulatory/government reports-Regulatory/government reports
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Researching Industry and Researching Industry and Suppliers ContinuedSuppliers Continued
Internet:Internet:-Hoovers, S&P reports-Hoovers, S&P reports-Lexis-Nexis, Dow Jones-Lexis-Nexis, Dow Jones-Dun & Bradstreet-Dun & Bradstreet-Trade publications, Purchasing -Trade publications, Purchasing
magazinemagazine
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Suppliers Researching Industry Suppliers Researching Industry ContinuedContinued
Interviews:Interviews:
-End-users-End-users-Purchasing organization members-Purchasing organization members-Suppliers-Suppliers-Trade organizations-Trade organizations
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Conducting the Initial BidConducting the Initial Bid (RFP and/or Auctions) (RFP and/or Auctions)
COMMUNICATION IS THE KEY
• Communication to the User Groups: In all things, keep the user group informed of developments with the process, the supplier, etc. The more they are informed, the less they are surprised by changes (and there are always changes).
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Conducting the Initial BidConducting the Initial Bid (RFP and/or Auctions) (RFP and/or Auctions)
Communication to Suppliers: It is vital that you speak with one, unified voice to suppliers during the process.
Communicate these points in both written and verbal correspondence, and make sure it is documented – Suppliers can and will claim that they weren’t informed, and it reflects badly on the state if you can’t prove otherwise!
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Negotiation and TechniquesNegotiation and Techniques
Negotiation is “the art of letting them have your way” ~Daniele Vare
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Negotiation and TechniquesNegotiation and Techniques
OBJECTIVEOBJECTIVE Provide a framework for Provide a framework for
approaching/conducting a negotiationapproaching/conducting a negotiation Discuss common negotiations tacticsDiscuss common negotiations tactics To be successful, a process requiring
analysis, empathy and game theory Discuss basic methodologies to estimate Discuss basic methodologies to estimate
supplier economicssupplier economics Review basic negotiations skillsReview basic negotiations skills
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PROCESS CHECK LISTPROCESS CHECK LIST
Determine Source able BaselineDetermine Source able Baseline– Incumbent data/past biddersIncumbent data/past bidders– Prism ReportPrism Report– Review past Usage ReportReview past Usage Report– Speak to current vendor to discuss Speak to current vendor to discuss
concernsconcerns
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PROCESS CHECK LISTPROCESS CHECK LISTCONTINUEDCONTINUED
Benchmark Pricing to Assess OpportunityBenchmark Pricing to Assess Opportunity
-Compare pricing using the internet-Compare pricing using the internet
-Compare pricing using the trade magazines-Compare pricing using the trade magazines
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PROCESS CHECK LISTPROCESS CHECK LISTCONTINUEDCONTINUED
INDUSTRY AND MARKET ANALYSISINDUSTRY AND MARKET ANALYSIS
-Used the Internet-Used the Internet
-Use the Trade magazines & -Use the Trade magazines & NewspapersNewspapers
-Spoke with Vendors-Spoke with Vendors
-Spoke with other purchasing -Spoke with other purchasing entities. entities.
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PROCESS CHECK LISTPROCESS CHECK LISTCONTINUEDCONTINUED
Reviewed potential sourcing categories Reviewed potential sourcing categories Establish comparative rankingEstablish comparative ranking Select initial categories to sourceSelect initial categories to source Meet/coordinate with User Group to discuss Meet/coordinate with User Group to discuss
negotiationsnegotiations
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PROCESS CHECK LISTPROCESS CHECK LISTCONTINUEDCONTINUED
Conduct Best and Final rounds and Negotiate*Conduct Best and Final rounds and Negotiate* Conduct additional best and final rounds*Conduct additional best and final rounds* Determine Savings*Determine Savings* Cost Avoidance for Extending for Re-bidding*Cost Avoidance for Extending for Re-bidding*
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QUESTIONS AND REVIEWQUESTIONS AND REVIEW
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DELAWARE ON LINEDELAWARE ON LINEADDRESSADDRESS
WWW.STATE.DE.USWWW.STATE.DE.US//PURCHASE PURCHASE (Contracts)(Contracts)
[email protected]@STATE.DE.US 302-739-1635302-739-1635
[email protected]@STATE.DE.USUS
302-739-5569302-739-5569
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STATE OF DELAWARE STATE OF DELAWARE CONTRACTINGCONTRACTING
THANK YOUTHANK YOU