How UNDP does business
Procurement refers to the process of acquiring goods, works and services. The process spans the whole cycle from identification of needs, choosing adequate procurement methods, sourcing suppliers and evaluation of their offers up to the award of contract. An integral part of the procurement process is the management of the contracts and assets through the whole project life cycle.
UNDP procurement is based on the principles of:
• Best value for money
• Fairness, integrity and transparency
• Effective international competition
• Interest to UNDP (economy, efficiency, equal opportunity to compete, transparency in the procurement process)
UNDP procurement is governed by an Internal Control Framework as well as the norms contained in the Financial Disclosure and Declaration of Interest, and Impartiality Statements (FDP). In order to provide a faster procurement process and delivery of goods and/or services, UNDP observes the local and international market and negotiates and maintains local Long-Term Agreements (LTAs) for goods and services that are frequently used by business units and development partners.
Importantly, UNDP Procurement is based on competitive bidding. Depending on the type, complexity, size and value of the project and its procurement elements, commonly used methods of solicitation include:
Request for Quotation (RFQ)
An RFQ is an informal invitation to submit a quotation, usually for goods/services/civil works at a value between US$ 2,500 and US$ 100,000. Prices, and other commercial terms and conditions are requested and award is made to the lowest priced technically acceptable offer.
Invitation to Bid (ITB)
An ITB is a formal invitation to submit a bid, usually associated with requirements that are clearly and concisely defined, with an estimated procurement value of US$ 100,000 or more. Normally price is the sole determinant in making an award. Where all technical criteria are met, award is made to the lowest bidder.
Request for Proposal (RFP)
An RFP is a formal request to submit a proposal, usually associated with requirements for services, which cannot be clearly or concisely defined, with an estimated procurement value of US$ 100,000 or more. Price is only one of several factors comprising the evaluation criteria. Award is made to the qualified bidder whose bid substantially conforms to the requirement set forth on the solicitation documents and is evaluated to be the lowest cost to UNDP.
In some cases, exceptions to competition are being made and direct contracting is used. This usually happens when an LTA is in place, either globally or locally (at the country-level).
The Unit manages goods and services by liaising with project personnel on specifications, delivery/payment terms and funds availability for procurement planning; identifying the appropriate procurement methods, submitting procurement information and requests to Asset and Procurement Committee (CAP), Advisory Committee on Procurement/internal UNDP procurement committees; ensuring access to favorable prices, reliable delivery terms, insurance, impartial advice and recognition of environmental and safety considerations.
In addition, the Unit manages office logistics and Individual Contractors/Consultants, maintains and updates the roster of suppliers and conducts surveys of the local market.