As potential supplier’s proposal are received, they are reviewed by procurement (to see if supplier could adhere to the stipulated delivery and compare price with other suppliers); by quality engineer (to see if supplier is prepared to abide by the quality requirements, and whether potential supplier has requested for any exception that is acceptable; also look at sample project quality plan (QP) and inspection and test plan (ITP) submitted by the potential supplier to verify whether they are acceptable in principle.
The quality engineer plays an active role by performing a desk top review of supplier bid documents such as ISO & HSE certifications; check their performance quality and safety wise on previous packages; ratio of quality personnel versus total personnel, etc.
The supplier proposal is also checked by the nominated package engineer by looking at the filled in data sheet, sample drawings and whether any deviation/exception requested that is acceptable.
The potential supplier may also have queries that should be responded by the client’s package team together with any deviation requested (either accepted or rejected). If the supplier is selected, then, this response sheet is finalized, signed by both the purchaser and the supplier and attached to the purchase order as part of the contract and shall be a legally binding document.
The bidders are short listed based on fulfilling the quality and certification requirements, acceptable engineering proposal, cost and delivery. It is always recommended to have an internal meeting between client’s package team members when short listing suppliers. This way a collective decision is made and suppliers are prioritized.
Some companies have checklists and a point based system, ranking the suppliers based on the highest marks given by the buyer, quality and package engineer.
Price, delivery, previous work experience with supplier, supplier’s reputation, supplier’s relevant certifications, supplier compliance with the data sheet; nature of exceptions/deviations requested are important parameter while selecting and ranking suppliers.
Normally, three suppliers are selected and are invited for a face to face pre-purchase or bid clarification meeting at client’s premises.