This document discusses procurement planning. It defines procurement planning and outlines the roles of user departments and procurement departments in developing procurement plans. It describes the contents of a procurement plan including activities, selection methods, cost estimates, time schedules and other relevant procurement information. The document emphasizes that procurement planning leads to benefits like best value for money, transparency, improved outcomes, and achieving objectives on time and within budget. It provides guidance on developing procurement plans, including identifying needs, determining selection methods, and obtaining necessary approvals.

1. Procurement Planning

2. • Definitions
• The concept of procurement planning
• Role of the User department level
• Role of the PDU level
• Things to avoid in the planning process
• Contents of a procurement plan
Presentation outline
5/5/2023

3. Learning Outcomes
At the end of the session you will be able to comprehend;
• Be able to comprehend and apply the Objectives
of Procurement across sectors
• Identify characteristics of procurement across
sectors
• Identify key stakeholders, their roles and
responsibilities across sectors
• Implement procurement process management
across sectors
• Identify and demonstrate the application of
principles of procurement across sectors

4. Procurement Plan
including its updates, shall include:
• a brief description of the activities/contracts;
• the selection methods to be applied;
• cost estimates;
• time schedules;
• any other relevant procurement information
• Pmclounge.com/pmp-training

5. Procurement Planning
• Planning entails defining the activities, scheduling
and sequencing, planning the requisite manpower
and staff required in sufficient quantities and
quality, planning the money that should be spent in
a time-phased manner and finally planning the
information system necessary for effective
communication to enhance project monitoring and
control

6. Why procurement planning?
1. Best value for money achieved
2. Encourages transparency
3. Improvement in procurement outcomes
4. Achievement of the organization's/project’s
objectives within time, cost and quality
standards.
5. It encourages cooperation between buyers and
vendors.
6. It facilitates the smooth operation of the other
procurement management functions

7. Why procurement planning?
7. Avoids risk and dangers of poor planning.
8. Achieving organizational/project goals/objectives
timely.
9. Minimizes emergencies
10. Efficiency is facilitated when realistic
11. Costs reduction: Saving money for the entity by
obtaining price reductions through quantity discounts
12. Control of cash flows
13. Acquired benefits of aggregation of various
requirements

8. Why procurement planning?
14. Team work enhanced (All stakeholders)
15. Fraud detection method
16. Fosters harmony and group working relationships
17. Facilitates inventory management
18. Increased productivity
19. A parameter for performance management
20. Providing sufficient lead time and resources in the
selection of appropriate contract types

9. Why procurement planning?
• Determination of the Need/Identification of
Need/Needs Assessment
• Make or Buy Decision
• Market Survey/Analysis
• Writing Procurement Specifications

10. Principles of Procurement Planning
• Team work
• Integration
• Economies of scale

11. 5/5/2023
KEY PLAYERS IN PREPARATION AND IMPLEMENTATION
OF PROCUREMENT PLANS
 Head of Project
 Contracts Committee
 Heads of Departments
 Finance/Accounts Department
 Procurement and Disposal Unit
 Management
 Users of the respective departments

12. Identification of the departmental requirements and
purpose of the procurement (needs analysis)
This may be based on the dept objectives and the
business strategy.
Previous activities that are repetitive
New trends in the business environment
A survey carried out e.g. capacity needs assessments
New activities to be achieved.
• A combination of all the above.
The Role of the User in planning
5/5/2023

13.  Prepare statement of requirements:
 Preparation of designs/drawings and building up of
the Bills of quantities(BOQ)-works
 Preparation of specifications based on the purpose
of the requirement.-supplies
 Preparation of the terms of reference (TOR) for the
services required-services
• These may also involve consultation with the key
technical departments and other stakeholders
including consultants.
Role of the User Cont’d:
5/5/2023

14. Costing of activities
Carry out market research on the cost of inputs
resulting from the bills of quantities.
Determine the cost of the supplies based on the
items specified.
Determine the estimated cost of the requirements-
including estimated transport costs, profit margin,
cost of inflation and any other cost drivers.
Assess the funds available and the source
 Prioritize the requirements to fit in the available
budget
Role of the user Cont’d
5/5/2023

15.  Prepare the work plan and the procurement plan
 A work plan is the list of activities to be
implemented, the timing of their implementation ,
and the budget.
 A user procurement plan is extracted from the work
plan.
 On completion, the user forwards the procurement
plan to the PDU for consolidation.
Role of the user Cont’d:
5/5/2023

16.  Update of the procurement plan.
 The user department informs the PDU on any
changes to the procurement plan for updates.
Role of the user cont:
5/5/2023

17. NAME OF PROCURING AND DISPOSING ENTITY
USER DEPARTMENT PROCUREMENT PLAN
Area/Section/Department ………………………..
Financial Year ………
S/N Description of item
to be procured
Quantity in
units or TOR or
Scope of works1
Estimated Cost Confirmed Source of
Funding
Time Frame (When item required)
1
2
3
4
5
6
7
8
9
Prepared by user: Approval by Head of Department Received by Head of PDU
Name:………………………… … Name:……………………………… Name:……………………………….
Signature: ……………………….. Signature: ……………………….. Signature: ………………………..
Date: ……………. Date: ……………. Date: …………….
1
Attach any details that cannot fit in this box
USER DEPARTMENT PROCUREMENT
PLAN
5/5/2023

18. Assess the work plans for all the
user departments
Categorizes the requirements in
terms of supplies, services and works
Estimates the total acquisition cost
of the specified requirements
The Role of the PDU
5/5/2023

19.  Aggregate the requirements for all the user
departments for the FY in terms of:
 The similarity of the items to be procured
 Items under the same method of procurement
 Biddable lots
 Items of the same timing
 Items under the same conditions of contract (e.g.
framework contracts)
PDU level;……..
5/5/2023

20. • Determination of the total time of the procurement
process.
• Consolidation of the procurement plan
• Obtain approval of the procurement plan
• Circulate the approved plan to the users and PPDA
for compliance purposes.
• Review and update the procurement plan
• Display the procurement plan & its updates on the
notice board,PDE and PPDA websites.
PDU level cont;……………
5/5/2023

21. Thresholds for supplies and non-
consultancy services
Method of
procurement
Threshold
Open biding above 200M
Restricted biding 100M- 200M
Quotations 5M-100M
Micro Procurements Less than 5M
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22. Thresholds for Works
Method of
procurement
Threshold
Open biding above 500M
Restricted biding 200M- 500M
Quotations 10M-200M
Micro Procurements Less than 10M
22

23. consultancy services
Method of procurement Threshold
RFP with EOI above 200M
RFP without EOI 50M- 200M
Individual consultant Less than 50M
Single or sole consultant No threshold
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24. • Preparation of strategic/Corporate plan
• Preparation of annual budget and cash flow
statement
• Preparation of program/department/unit work
plans
• Preparation of a consolidated procurement plan
Procurement planning procedures
5/5/2023

25. Steps In Preparation Of A project Procurement
Plan
(i) Beware of the opportunities in the external
environment
(ii) Establish objectives, expected results, where to place
emphasis, policies, procedures etc.
(iii) Determine your present stand against desired
accomplishments
(iv) Determine project's work plans/ programmes
(v) Analyze your strength and weaknesses (SWOT)
(vi) Clear assignment of individual responsibility for
preparation of a Procurement plan
(vii)Carry out a Needs Assessment/Review to determine
the procurement requirements
(viii)Determine purpose of the procurement and its timing

26. Steps In Preparation Of project
Procurement Plan
(ix) Involve and consult key stakeholders
(x) Carry out market research for prices, source of supply, type
of supply market, etc.
(xi) Make clear specifications/TOR/SOW of requirements
(xii) Write down the procurement plan
(xiii)Forward the procurement plan to Procurement department
(xiv)Consolidate procurement plans (Into a master/corporate
procurement plan)
(xv) Agree with other departments/Finance on the procurement
cash flow allocations over the period
(xvi)Match procurements to funds/cash flow

27. Steps In Preparation Of A
Procurement Plan
(xvii)Obtain approval of the procurement plan (by
funder/project’s headquarters) and funding
(xviii)Circulate approved procurement plan to
users
(xix)Review and update of the Procurement Plan

28. Contents Of A Procurement Plan
• Output/outcome to contribute to.
• A detailed breakdown of procurements to be
undertaken in order of priority
• Type/method of procurement to use
• The quantities of requirements and the unit of
measurement.
• Value of procurement
• Confirmed source of funding for the
procurements

29. Contents Of A Procurement Plan
• Total time the procurement process will
take(lead time)
• Realistic time (date) when each procurement
will be required by the user
• Latest date when each procurement will be
initiated by the user
• Financial year of initiation of the procurement
• Financial year of payment for the procurement
• Levels of authorization.

30. Specimen 3.1: Procurement Plan

31. Specimen 3.2: Master Procurement
Work Plan

32. Implementation Of A Procurement Plan
• Initiate each procurement early enough
• Carry out the procurement process
• Review, monitor, adjust and update the
Procurement Plan
• Circulate feed back regularly to users
(customers and other stakeholders)

33. IMPLEMENTATION OF A PROCUREMENT
PLAN - continued
For emphasis implementation and management of the
Procurement Plan requires:
 Timely approval of the work plan by Management
 Timely sourcing and availability of funds
 Purchase Requisitions being raised timely – by User
departments
 Timely processing of procurements by
PDU,Contracts Committee and Accounting Officer
 Timely reporting on Procurements to PDE and other
external stakeholders e.g PPDA – by PDU
5/5/2023

34. Benefits Of Procurement Planning
 Organizational/departme
ntal goals are met as
planned
 Procurement objectives
met timely
 Efficient and realistic
budgeting
 Aggregation of
requirements
 Use lots for different
categories of
procurements
 Emergency procurement
minimised
 Improved cash flow planning
 Reduction of administrative
and transaction costs
 Procurement performance
measurement
 Enhanced team work
 Harmonious working
relationship
 Value for money
5/5/2023

35. Evaluation and Monitoring of Plan
• According to Appiah (2013) studies have showed that the simple enactment of
laws and regulations are not enough to curb procurement corruption unless it is
supported by severe monitoring and evaluation activities.
• Barasa (2014) argues that planning generally provides the basis for monitoring
and control.
• Such activities include monitoring of risks, measuring how effective treatments
given to risks have been on a regular basis and taking corrective actions when
needed to ensure continuous improvement of the system (Tan, 2013).
• The monitoring and evaluation system should also identify the risks and
vulnerable points at each stage of the procurement process (Agaba and Shipman,
2007).
• This can be done by 45 establishing key performance indicators and milestones to
be used in monitoring and assessing progress (RPPA, 2010).
• Constant monitoring of practitioners and entities reduces the likelihood of the
occurrence of any corrupt practices in procurement (Ampofo, 2013).

36. • Watch the video links below and attempt the
questions on the activity on the next slide
https://www.youtube.com/watch?v=rbjx0NH9XiQ
https://www.youtube.com/watch?v=S8O1QX184oU

37. Activity 3.1: Group Work
• Formulate groups of 10 Members representing 6 different
departments of a project of your choice
• List two departmental objectives aligned the project
Goals/Objectives
• List two activities you intend to carry out in F/Y 2020/2021 to
achieve departmental goals
• List all resources required to undertake each of the activities
above
• Extract the procurable items ( works, services, supplies) and
generate a departmental procurement plan
5/5/2023

39. Challenges Faced In Procurement
Planning
• Inadequate Training of Procurement Personnel
• Poor Coordination between Departments
• Financial Constraints
• Economic and Market Conditions
• Lack of Effective Monitoring of Oversight Agencies
• inadequate identification and definition of needs,
• unrealistic estimates and budgets

40. 40
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