TAKORADI POLYTECHNIC

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TAKORADI POLYTECHNIC
ASSESSING THE CHALLENGES IN NEGOTIATION UNDER THE PUBLIC
PROCUREMENT ACT
BY
DONSAANYE ISAAC NEWTON
(07512421)
A PROJECT WORK
PRESENTED TO THE SCHOOL OF BUSINESS STUDIES
IN PARTIAL FULFILLMENT OF THE REQUIREMENTS
FOR THE AWARD OF BACHELOR OF TECHNOLOGY IN PROCUREMENT
OCTOBER, 2014

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DECLARATION
I hereby declare that this project work is the result of my own original research work
undertaken under the supervision of the undersigned and that all works consulted have been
acknowledged and it has not been submitted to any institution for the award of any higher
diploma/degree.
Candidate’s Name: Donsaanye Isaac Newton
Signature…………………………………………………………………
Date ………………………………………………………………………
CERTIFICATION
I certify that the project work has been supervised and assessed in accordance with the laid down
guideline by Takoradi Polytechnic.
Supervisor’s Name: Mr. Stephen Normanyo
Signature ……………………………………………………………………….
Date………………………………………………………………………………

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Head of Department:
Name: Mr. Isaac Opoku-Fofie
Signature ……………………………………………………………………………
Date …………………………………………………………………………………
DEDICATION
This project work is dedicated to my sweet lovely mother (Miss Elizabeth Esi Elleta) for all
the prayer and encouragement she gave to me during this short period of my study. Without
her prayer and support I wouldn’t have known how to complete this program.
Mother God richly blesses you.
ACKNOWLEDEMENT
My indebtedness is to the Almighty God for giving my strength and people to support me
throughout the period of this research.
I thank Mr. Stephen Normanyo for his patience, guidance and corrections in ensuring
successful completion of this study. Sir your guidance, support, supervision, motivation, and
constructive criticism lead into coming out with this product.

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To the staff of Public Procurement Authority, Sekondi-Takoradi Metropolitan Assembly and
especially to all respondents of the institutions who provided empirical data, to make my
research a success.
My final appreciation goes to all those who have contributed in diverse ways in ensuring the
successful completion of this work. I say God richly bless you all.
ABSTRAT
This project work is a study of “Assessing Challenges of Negotiation under the Public
Procurement Act”, in the Public Sector with the focus on the Public Sector Companies in the
Western Region of Ghana. The study assessed the challenges with the implementation of the
Public Procurement Act 2003 with attention paid on Section 64 of the Act, to assess the
challenges/difficulties faced by the public entities under Section 64 in connection with
negotiations and its adaptation in their procurement processes.
Chapter one focuses on an introduction of the study which gives a background to the
importance of negotiation in procurement and also the difficulty entities have in the usage of
negotiation in the purchasing of their negotiation. Research questions and objectives were
stated to enable the assessment of the challenges of negotiation to be carried out.
To understand and gain useful insight to the topic, general literatures went reviewed from
institutions and authors on negotiation and laws of the jurisdictions on procurement

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negotiation. Attention was paid on how rules and regulations governing the usage of
negotiation and was also given attention. It enable examination of what requirements or
procedures entities have to comply with in relation to negation for their requirements and that
of the position of the law on usage of negotiation in procuring items.
In order to gather data for the research, structured questionnaires and face-to-face interview
were used to obtain data for the study. The data was coded and analysis done using 16.0
Version of SPSS.
Analysis, presentations of the data in tables, charts and finding of the data obtain are presented
in chapter four of the research.
The conclusions recommendation and findings of the study are presented in chapter five,
where it was concluded that the phrasing of section 64 is misleading as it does not portray the
real intent of the section. It was observed that negotiation has an important role in public
sector procurement. To ensure that the objectives of Act 663 is achieved, the Public
Procurement Authority should intensity the training and monitoring/evaluation of
practitioners in the public sector of the usage of negotiation during procurement processes to
show which stage in the processes it can be used or adopted.

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TABLE OF CONTENT
CONTENT PAGE
Title page i
Declaration ii
Certification ii
Dedication iii
Acknowledgment iii
Abstract iv
Table of Content vi
List of Tables x
List of figures xi

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CHAPTER ONE INTRODUCTION
1.0 Introduction 1
1.1 Background of the Study 1
1.2 Statement of the Problem 3
1.3 Objectives of the Study 4
1.4 Research Questions 4
1.5 Significance of the Study 5
1.6 The Scope of the Study 5
1.7 Limitations of the Study 5
1.9 Research Methodology 6
1.8 Organization of the Study 6
CHAPTER TWO LITERATURE REVIEW
2.0 Introduction 7
2.1 Definitions 7
2.2 Approaches to Negotiation 8
22.2.1 Adversarial (Hard or Competitive) 9
2.2.2 Collaborative (Soft or Cooperative Integrative) 9
2.2.3 Principled Approach (In-Between Soft and Hard) 10
2.2.4 Strategic Approach 11

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2.3 Concept of Procurement Negotiation 11
2.4 Objectives of Negotiation 12
2.4.1 Setting of Objectives in Negotiation 13
2.5 Post-Tender Negotiation 14
2.6 Pre-Contractual Negotiation 15
2.7 Ethics in Negotiation 17
2.8 Negotiation Planning 19
2.9 What to Negotiate 20
2.10 When to Negotiate 22
2.11 Other Procurement Laws and Negotiation 23
2.11.1 The EU Procedure 24
2.11.2 Jamaica Procedure 25
2.11.3 The Nigeria Procedure 25
2.11.4 The United States of America Procedure 27
2.12 Conclusion 28
CHAPTER THREE METHODOLOGY
3.0 Introduction 29
3.1 Research Framework 29
3.2 Population/Sample Size 30
3.3 Sampling Methods 30
3.4 Variable of the Study 31
3.5 Data Collection Methods 31
3.6 Data Collection Activities 32

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3.7 Pilot Studies 32
3.8 Triangulation 32
3.9 Data Analysis Procedures 33
3.10 Background of the Areas of Study 33
CHAPTER FOUR DATA ANALYSIS AND DISCUSSION
4.0 Introduction 39
4.1 Research Objectives and Questions 39
4.2 Responses to Questionnaires 40
4.3 Analysis and Discussions 40
4.3.1 Demography – Gender Analysis 41
4.3.2 Demography – Educational Background 42
4.3.3 Analysis on Usage of Negotiation in Public Procurement 43
4.3.4 Stages of Procurement Process Negotiation Is Used 45
4.3.5 Awareness of Section 64 of the Procurement Law (Act 663) 46
4.3.6 Implication of Section 64 on Negotiation 48
4.3.7 Analysis on Compliance to Section 64 49
4.3.8 Seeking of Approval before Undertaking Negotiation with Suppliers/Contractors 50
4.3.9 Analysis on Lowest Evaluated Price Being Within Budget 52
4.3.10 Contribution of Section 64 to Transparency in Procurement Process 54
4.3.11 Section 64 and Reduction of Corruption 56
4.3.12 Section 64 and Value for Money 58
4.4 Conclusion 59

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CHAPTER FIVE SUMMARY OF FINDINGS, CONCLUSIONS AND
RECOMMENDATION
5.0 Introduction 60
5.1 Summary of Research Findings 60
5.1.2 Research Question One 61
5.1.3 Research Question Two 62
5.1.4 Research Question Three 63
5.1.5 Research Question Four 64
5.2 Recommendation 65
5.3 Conclusion 66
REFERENCES 64
APPENDIX 66
LIST OF TABLES
Table 4.1 Gender analysis 41
Table 4.2 Analysis of Educational Background 42

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Table 4.3 Analysis of Usage of Negotiation in Public Procurement 43
Table 4.4 Analysis of Stages of the Procurement Process
that Negotiation is employed 45
Table 4.5 Analysis of Awareness of Section 64 of
the Procurement Law (Act 663). 46
Table 4.6 Implication of Section 64 on Negotiation under Procurement Law 48
Table 4.7 Analysis of Compliance of Section 64. 49
Table 4.8 Analysis of Seeking of Approval before Undertaking
Negotiation with Suppliers/Contractors 51
Table 4.9 Analysis of Lowest Evaluated Price within Budget 52
Table 4.10 Analysis of Contribution of Section 64 to
Transparency in Procurement Process 54
Table 4.11 Analysis of Contribution of Section 64 to
Reduction of Corruption in the Procurement Process 56
Table 4.12 Analysis of Section 64 in Ensuring Value for Money 58
LIST OF FIGURES
Figure 1: Gender analysis 41

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Figure 2: Educational Background 42
Figure 3: Usage of Negotiation Public Procurement 44
Figure 4: Stages of the Procurement Process that Negotiation is employed 45
Figure 5: Awareness of Section 64 of the Procurement Law (Act 663). 47
Figure 6: Implication of Section 64 on Negotiation under Procurement Law 48
Figure 7: Compliance of Section 64. 50
Figure 8: Approval before Undertaking Negotiation with Suppliers/Contractors 51
Figure 9: Analysis of Lowest Evaluated Price within Budget 53
Figure: 10 Contribution of Section 64 to Transparency in Procurement Process 55
Figure: 11 Contribution of Section 64 to Reduction of
Corruption in the Procurement Process 57
Figure: 12 Section 64 Ensuring Value for Money 58

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CHAPTER ONE
INTRODUCTION
1.0 INTRODUCTION
Negotiation is the process whereby individuals/parties bargains, discuss, communicate with
different objectives or aims to reaching an agreement, conclusion or otherwise.
Should an entity use negotiation to selecting a supplier for it requirements or not and what thus
the procurement law says of such a situation.
This chapter introduces the phenomenon understudy. It consists of the background of the
study, statement of the problem, objectives of the study of the researcher in carrying out the
study, scope of the study and significance of the study. The chapter finally outlines the
structure of the research
1.1 BACKGROUND OF THE STUDY
Negotiation is an overall strategic plan that aims at achieving the objective of a party through
combination of their aims/objectives, knowledge of the other party, who they negotiate with
and the power/authority of the negotiating team. In negotiation therefore, there is utilization of
knowledge and skills to get as near as possible to getting the achievement of the goals of the
parties. It is important in procurement as it enables entities to deal with disputes that might
arise in the process of procurement such as problems of terms and conditions, warranties,
payment terms or price.
In Ghana, public procurement accounts for 50% - 70% of the national budgets after personal
emolument, 14% of gross domestic Product (GDP) and 24% of imports. Implicitly, Public

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Procurement therefore has both social and economic impact on the country (World Bank,
2003).
The Public Procurement law, Act 663 Section 64 (1) sought to explain or give limitation or
certain conditions which must be met before negotiation is allowed to take place. For
negotiation to be undertaken reference must be made to the Tender Review Board for approval
in order to undertake negotiation as per section 64(2b) of Act 663.
Actually what the Act has done is to only create limitation or condition at the pre-contractual
stage of a tendering procedure but is very silent at the post contractual stage (section 64(1),
Act 663)
This research is to introduce the concepts and techniques, providing best practices and unique
options for reaching a conclusion, agreement or otherwise. It will unearth the stances of the
law on negotiations, the impediments to its application, the principles of negotiation, its gains
to entities and demerits and importantly key objectives when undertaking negotiation.
At the end of this research, employers/employees alike, students and importantly procurement
officers will be equipped with the confidence and skills need to conduct a successful and
constructive negotiation without faulting/breaching the law on procurement. It will unearth
the challenges faced by purchasing professionals in negotiation, the skills required to
undertake negotiation and the does and don’t of negotiation. It is with this intention that the
researcher has chosen the topic ‘‘assessing The Challenges of Negotiation under the Public
Procurement Act 663’’ to identify the problems relating to his field of study, provide
suggestions and recommendations.

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1.2 STATEMENT OF THE PROBLEM
Society is increasingly calling for public institutions to ensure the tax payer’s money is well
spent. Though most institutions or companies are exploiting ways of reducing cost/wastage,
the practice of not undertaking negotiation is very common in Ghana according Nana Dr.
S.K.B. Asante (2014) Defective Negotiation Waste National Resources.
One way for an organization is to adopt a process that focuses on attaining remarkable
business results without compromising the lay down procedure. This is so because the world
has moved to a point where one needs to effectively reach agreements that settle disputes,
solidify relationship and further the goals of business organizations.
The way section 64 of the Public Procurement Act (Act 663) is captioned “Prohibition of
negotiation with supplies/contractors” deters professionals from adopting negotiation in their
procurement activities and a true intent of the section needs to be understood
Considering that negotiation helps parties achieve value for money by ensuring improved
quality, quantity, delivery and in some cases changes of commodities or structure of a given
contract in order to provide the best to consumers, the true intent of the section needs to be
ascertained in order for these benefits of negotiation to be upheld.
It is for these reasons the researcher considers a study into the implications of section 64 of the
Act necessary to assess the challenges of negotiation in public procurement and how it impacts
on Public Sector Companies in the Western Region.
1.3 OBJECTIVES OF THE STUDY
The main objective of the study is to “Access the challenges of negotiation in public sector
companies in the Western Region”.

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The specific objectives that would enable the general objective of the study to be achieved are
to:
i. Ascertain the understanding of section 64 of the Procurement Act.
ii. Evaluate how section 64 is practically applied in procurement proceedings.
iii. Investigate the implications of section 64 on the outcome of public procurement
proceedings.
iv. Find out the level of compliance to the Procurement Act.
v. Find out the relationship between negotiation and procurement.
vi. Assess the role of negotiation in ensuring value for money.
1.4 RESEARCH QUESTIONS
In order to provide answers to the research objectives, the following questions are posed for
investigation:
i. Is negotiation in public procurement an infringement of the Procurement Law?
ii. Does negotiation under Public procurement compromise the objectives of the
Procurement Law?
iii. Is there any relationship between negotiation and the intended benefits of the
procurement law?
iv. Does the Procurement Act limit the application of negotiation in enhancing value for
money in the public sector?
1.5 SIGNIFICANCE OF THE STUDY
Having assessed the challenges of negotiation in public procurement, it is envisaged that, the
findings and recommendation would prove quite beneficial to government entities,

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organization, saves cost, time and help develop likely to be faced issues in negotiation
preparation, the method to be adopted in negotiation and to suggest for such problem that
might arise.
This study can be used by students, professional, lectures as a guide when undertaking
negotiation to understanding the concept of negotiation under the law.
Importantly the writer’s knowledge is updated on negotiation pertaining to its application and
has a better view about it.
1.6 SCOPE OF THE STUDY
The research is limited to challenges of negotiation in procurement of public sector companies
in the Western Region. The study focuses on the Sekondi/Takoradi Metropolitan Assembly
(STMA), The Regional Medical Stores, Ghana Water Company Limited (GWCL), Ghana
Supply Company Limited (GSCL) and Public Procurement Authority (PPA).
1.7 LIMITATION OF THE STUDY
The study is conducted on public sector companies in the Western Region.
Access to information was a main factor that made conducting of the study difficult. This
constraint did not hamper the research due to the methodology that was adopted in conducting
the research.
Also due to inadequate period for the face-to-face interview it did not allow the researcher to
have enough time to get much more insight of the company negotiation activities from
personal as the researcher was not able to observer how negotiation is undertaken in the
company.

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1.8 METHODOLOGY OF THE STUDY
The study is descriptive as it seeks to assess the challenges of negotiation in water sector
procurement. The sampling technique that is adopted for this research is Purposive sampling
procedure. Questionnaires and face-to-face interviews method of data collection was used to
ensure a high degree of representation or accuracy of results and to avoid ambiguity of
questions in the questionnaires.
The data was collected from both primary and secondary sources.
Presentations of data were analysis in the form of visual presentation as in pie charts,
histogram and bar charts. The data were analyzed by the normal distribution.
1.9 ORGANIZATION OF THE STUDY
In this study, there are five chapters, Chapter One deals with introduction, background,
objectives of the study, significance of the study, research questions, and scope of the study.
Chapter Two looks at the review of related literature of the study.
Chapter Three presents the research methodology. The sample/sampling procedures and the
questionnaire survey used in the conducting the research.
Chapter Four also is about the presentation of result and its discussions.
Finally, Chapter Five presents a brief summary of the main findings of the study, conclusions
with regards to the new knowledge derived from the research and recommendations for
conducting negotiation under the public procurement law.

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CHAPTER TWO
LITERATURE REVIEW
2.0 INTRODUCTION
This chapter reviews works done on Procurement Negotiations theoretically. The review
focuses on the definitions of negotiation, approaches to Negotiation, concept of procurement
negotiation, Negotiation planning in procurement. This chapter will further present
negotiation in the public procurement adopted in this study and explain in detail the constructs
of the study.
2.1 DEFINITIONS
Simply by trying to obtain a discount on for instance safety gloves through to complexities of
major capital purchase are all ways of negotiation. For procurement professional to be
successful with suppliers to obtaining best prices with best conditions for every item that is
purchased, the skills of negotiation are important. This section looked at the various
definitions and concepts of negotiation. These definitions help the study to be understood and
the various aspects of the topic brought into focus.
Lysons & Brian, (2006) defines negotiation is any form of verbal communication in which the
participants seeks to exploit their relative competitive advantages and needs to achieve explicit
objects within the overall purpose of seeking to resolve problems that are barriers to
agreement

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According Chartered Institute of Purchasing and Supply (CIPS) negotiation is to communicate
with the object of reaching an agreement by means, where appropriate of compromise.
From Fisher & Ury, (1983) Negotiation is a basic means of getting what you want from
others. It is back and forth communication designed to reach an agreement when you and the
other side have some interest that are opposed.
In the purchasing process, negotiation covers the period from when first communication is
made between the buyer and the supplier through to the final signing of the contract.
In general context, negotiation is a bargaining process between two or more parties, each with
its own viewpoints and objectives, seeking to reach a mutually satisfactory agreement on, or
settlement of, a matter of common concern.
In the purchasing context, it is the process of arriving at an agreement on the conditions of
contract, through discussion between buyer and seller.
From Torrington & Hall, (1993), negotiation is a long standing art, which has developed into
a major mode of decision making in all aspects of social, political and business life, even
though there is always a feeling that negotiation is no more than a substitute for direct and
decisive action. Viewing from the above definitions, it is important to point out that the role
of negotiation is an important tool in the hands of the procurement officer when procuring for
an industry, firm, company and as a nation in general.
2.2 APPROACHES TO NEGOTIATION
According to Fisher & Ury, (1992) negotiation is a basic means of getting what you want from
others. That is to say that wherever we find ourselves in business, government or family
decisions is reach through negotiation. Thus the approaches that are adopted for negotiation
often leave people satisfied, dissatisfied, tired or alienated.

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According to Lyons & Farrington, (2006), the approaches to negotiation many be classified as
Adversarial (Hard or competitive) and collaborative (Soft or corporative).
Fisher & Ury (1981) develop a third approach which is neither hard nor soft but rather both
hard and soft at the Havard Negotiation Project and termed it as Principle Negotiation.
2.2.1 ADVERSARIAL (HARD OR COMPETITIVE)
From Herman et al (2001), this approach is characterized by aggressiveness and a
confrontational. Winning is everything and personal feelings and interpersonal relationships
are viewed as essentially irrelevant.
As Lysons & Brian, (2006) puts it, it is an approach in which the focus is on ‘positions’
staked out by the participants and the assumption is that every time one party wins, the other
loses .
This approach which focuses on ‘position’, it is basically about bargaining power that which
determines the party that comes up top. Parties’ interests are diametrically opposed as it is
characterized by high demands, specific positions, and few concessions, slow in making
concession and tends to discuss issues narrowly.
In this approach, one party seeks to have all of their requirements recognized without giving
any reciprocal recognition to the valid needs of the other party.
2.2.2 COLLABORATIVE (SOFT OR COOPERATIVE INTEGRATIVE)
In this approach, premium is place on interpersonal relations and strives for common grounds,
shared interests and understanding between parties.
Is an approach in which the assumption is that, by means of creative problem-solving, one or
both parties can gain without the other having to lose from Lysons & Brian,( 2006).

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Lewicki et al, (2003) explains it as an integrative approach uses objective criteria, look to
create conditions of mutual gain, and emphasize the importance of exchange information
between parties and group problem-solving.
That is emphasis is on problem solving, cooperation, joint decision-making and mutual gains.
Integrative strategies call for participants to work jointly to create win-win solutions.
This style is friendly, courteous and concessionary. It is neither purely opposed nor purely
compatible of the party’s interest. It promotes trust and relationship aim at both parties
gaining the outcome. It is characterized with reaching conclusion quickly, building long term
relationship, good reputation and image. There is mutual interests but never be mislead into
underestimating the other position. It is not to be too friendly and concede too much.
Negotiators may look ways to create value and develop shared principles as a basis for
decision-making about how outputs should be claimed.
From Wondwosen,( 2006) this approach it might be time consuming, but in the long run
(negotiating Process) will not only save time, but it also will enable wiser, more robust, and
more valuables deals).
2.2.3 PRINCIPLED APPROACH (IN-BETWEEN SOFT AND HARD)
According to Fisher & Ury (1981), this approach is neither soft nor hard but rather soft and
hard. It is a sword and shield approach. It looks at issues on merits rather than through a
hurdle process which is focused on what each side says it would do or not do. It looks for
mutual gains wherever possible as in collaborative negotiation and where interest conflict,
insistence is on the results of some fair standards independent of the wishes of both parties.
Fisher & Ury, (1981) argues that principled negotiation goes beyond the limited strategic
choices of distributive bargaining. The Principled approach is hard on merits and soft on

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people. It employees no tricks or posturing. It enables fair dealings while it protects against
those who would take advantage of a party fairness.
In their book “Getting to yes: Negotiating Agreement Without Giving In, Fisher & Ury, the
methods of the principled approaches are five (5) main principal. These are;
 don’t bargain over positions
 separate the people from the problem
 Focus on interests not on positions
 invest/generate options for mutual gains
 insist on using objective criteria.
2.2.4 STRATEGIC APPROACH
According to Tanya & Azeta, (2008), this approach has its roots in mathematics, decision
theory and rational choice theory, and also benefit from major contributions from the area of
economics, biology and conflict analysis. The emphasis of this model of negotiation is on the
role of ends (goals) in determining outcomes. From Raigga, (1982) it is normative in nature.
The grounded belief is that there is no one best solution to every negotiation problem.
What ultra-smart, impeccable rational, super-people should do in competitive, interactive [i.e.
bargaining] situations.
2.3 CONCEPT OF PROCUREMENT NEGOTIATION
According to Darian (2003) public procurement professional have long had the reputation as
knowledgeable bid evaluators. They can analyze offers to determine responsiveness. Conduct
a technical evaluation of the bidder’s capabilities, and even perform cost analysis. Due to an
increase use of Request for proposal process there is a logical need for negotiation.

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Shapper et al, (2006), public procurement is inherently a politically sensitive actively, not least
because it involves significant amounts of public money even within the context of a national
economy.
The purpose of public procurement is to obtain the best value for money and to do this it is
important to consider the optimum combination of “whole life cost” of a purchase and its
fitness for purpose. Procurement negotiation is the preferred method used in price
determination is situation where the conditions are absent, in the competitive bidding process
because a sole-source situation is created.
Procurement negotiation focuses on getting lower prices for goods and other services from
vendors but this is being moved to focusing on the best service, quality and conditions.
If public procurement professionals are serious about bringing their “A game” to the table,
they should realize the value of negotiation.
A negotiated procurement is any non-sealed bidding procurement that is above the simplified
acquisition threshold. (FAR Part15,US)(www.canadain/ternatiaonal.gc.ca/……../acquisition).
As stated by Leenders & Fearon (1993), negotiation is the most sophisticated and most
expensive means of price determination.
2.4 OBJECTIVES OF NEGOTIATION
There are several objectives that are common to all concerned with negotiations. The
objectives to negotiation as by (Burt et al, 2003) are
i. To obtain the quality specified
ii. To obtain a fair and reasonable price
iii. To get the supplies to perform the contract on time.
iv. To exert some control over the manner in which the contract is performed.

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v. To persuade the supplies to give maximum cooperation to the purchasing
company.
vi. To develop a sound and continuing relationship with competent suppliers.
vii. To create a long-term relationship with a highly qualified supplier.
2.4.1 SETTING OF OBJECTIVES IN NEGOTIATION
To negotiate successful, one needs a game plan. Thus in setting of objectives one should look
at two (2) main issues;
 Identifying the objectives
 Prioritizing the objectives
In identifying the objectives, the rules are
o Declare about what you want to achieve for the organization.
o Declare about objectives covering personal relationships
o Aim high
o Set specific measures of performance
o Remember the total picture (look at it holistically).
o Know what your bottom line is
o Anticipate the other parties’ objectives and area of interest.
In prioritizing ensure that compromise made is not on the wrong issues as such in prioritizing
it should be:
- Those that are your ideas
- Those that present realistic target
- Those that are the minimum you must fulfill to feel that the negotiation has not
been a failure.

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For instance:
COMPANY PRIORITY GRADE SUPPLIER
Price 1st
Quality
Time 2nd
Price
Quality 3rd
Time
Quantity 4th
Quantity
2.6 POST-TENDER NEGOTIATION
This is an important aspect of purchasing strategy in government procurement of high value
item/services/works.
This gets the best outcome and commercial arrangements for the government in that it is seen
as a process of selecting the lowest-priced compliant bid.
Post-tender negotiation refers to the negotiation that take place between a client and potential
Suppliers, after the receipt of tenders but prior to contract award Chartered Institute of
Purchasing and Supply (CIPS) belief that post-tender negotiation is an appropriate process to
securing value for money. The reason being that often there are points in tender documents
which need to be clarified. Taking the Public Procurement Act 663 of Ghana section 64, it
encourages post-tender negotiations.
As Kai Kruger explained that in the Norwegian offshore industry before Norway signed the
European Economic Area (EEA) agreement with the then European Economic Community
(EEC) they combined traditional tender producers for fabrication and services contracts with
hard-core negotiation. The industry underlined that only strict cost-effective commercial
criteria ruled the successful selection of a contract candidates as regarded the EU(European

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Union) procedure to be unnecessary bureaucratic. The arguments being that the need of an
entity to adopting a joint design or project schemes to a contract commitment and that a strict
procurement regime prohibiting flexibility in respect of a contract may mean that after
conclusion of the contract variation of orders or worse might occur which will lead to a
renegotiation of contents and scope of performance of contract which might defeat the aim of
lowest cost. (Pro Sue et al,) explains that under the stages in procurement process there is
restriction on the post-tender negotiation under the open and restricted procedures. Although
entities are entitled to enter into discussions with Tenderers for the purpose of clarification on
specification, the entity is prohibited at that stage to go negotiate on the principal terms and
conditions of the contract including prices and specifications.
This situation is same as in the case of Ghana Public Procurement Law as the law is silent on
the post tender stage. For example in situations where bids appears especially low or high on
price, clarification is needed and thus a procurement professional goes into negotiation not to
alter the terms and conditions, warranties, payment terms or price to defeat competitiveness
and value for money. Therefore in undertaking this it must be done professionally and
ethically to ensure that post-tender negotiation on price, suppliers are treated fairly and
courteously.
2.7 PRE-CONTRACTUAL NEGOTIATION
The European Union (EU) law and the U.S. law bans Pre-contractual negotiations as the
contracting entity is made to adapt a joint design and project schemes to the subsequent
contract commitment. Strict procurement regime prohibiting flexibility in this respect means
that the adaptation must be done after conclusion of the contract.

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This is due to the fact that the EU/EEA has a principle of equality in the procurement law
supports the call for transparency. Negotiations must necessarily imply parallel dialogues with
several candidates, and even if negotiations should be recorded for subsequent supervision, the
risk of discretionary preferences in the profiling and selection may not be ignored.
The current EU/EEA module, which states that a formal ‘one and final shot’ tender procedure
shall be applied in all public contracting, ruling out negotiations except for minor clarifications
in the contents of the submitted bids. Alternatively, but only in extraordinary situations, the
regime allows for the ‘negotiated procedure’ which, however, is not to be treated as tendering
at all. In the exceptional cases of negotiated procedure, the latitude for selection and
adaptation of potential contract terms is necessarily somewhat more open than in the tendered
procedure – although not at all wide open. The published tender documentation should not be
modified significantly, not even in the negotiated procedure. Neither should the detailed
indications on which sub-criteria that will eventually decide the final award of the contract.
This protects the potential candidates, who have abstained from participation in the
competition for the contract, trusting that the published indications would be indicative of
qualifications and final selection of the winner.
The 2004 EU law reform maintains the negotiated procedure formula and introduces certain
clarifications. But more importantly, the new regime extends the area of negotiations to
comprise also the novel concept ‘competitive dialogue’ applicable on ‘particularly complex
contracts’ where national legislator may provide for the procedure defined in Dir 2004/18/EC
Article 29. Since the EU/EEA tender procedure is mandatory in supplies, works and service
contract awards, there is pressure for liberal interpretation of the provisions on alternative
negotiated procedures as well as for conducting communications and dialogues in the ‘closed
door’ tender procedure, both multilaterally simultaneously with competitive candidates and

29
unilaterally with the apparent most preferential candidate while attempting to impact on
potential contract terms under the disguise of ‘clarifications’. The role of the parties change as
the process moves along. Before award decision is taken, all participating parties may press
for latitude and discretion. Afterwards, parties which feel disadvantaged and their attorneys
will scrutinize the process to detect, identify and invoke any potential violation of the rules.
Alleged unlawful negotiations are quite often invoked in national court cases or in cases put
before national complaint boards. The EU/EEA public sector ‘remedy’ Dir 89/665/EC Article
2 No. 1.
2.8 ETHICS IN NEGOTIATION
The dictionary definition of ethics is “a system of moral principles or values; the rules or
standards governing the conduct of the members of a profession: accepted principles of right
or wrong”. Ethics establishes means of doing what is right, fair and honest.
According to Stark & Flaherly, (2003) Reputations plays a vital role in every negotiation, it’s
much easier to achieve win-win outcomes when you have a reputation for being fair, honest
and willing to do the right thing.
Ethical negotiators don’t think only about what they can “get” out of a negotiation but also
about what they can “give” to their counterpart. The elements as stated by stark & Flaherty
are;
i. Know what is not negotiable
ii. Be honest
iii. Keep your promises
iv. Have multiple options
v. Be willing to say “no”

30
vi. Be familiar with the law
vii. To with your get
viii. Practice the concept of “no surprises”
ix. Follow the platinum rule: treat people the way they want to be treated.
x. Be willing to walk away from a deal.
Lysons & Brain, (2006) explain that ethical negotiation can only take place in a climate of
trust but ascertaining that a negotiator requires to answer two questions ‘can the other party
trust us?’ and ‘can we trust them’.
Crampton and Dees (1993) suggests the following to promote honesty in all negotiation’.
o Assess the situation. That is considering incentives for deceptions.
o Build mutual trust: the incentive due to fear of the negotiation is defensive due
to fear of the other party will fell to be unfairly exploit of any weakness.
o Place the negotiation in a long-term context covert emptor.
Also issues of;
o The dress code/wore
o The face makes
o Gestures especially when dealing with multi-cultural persons such as fingers,
hands and body movements.
o The usage of language
o Movement of persons in/out of the negotiation situation/venue.
From Weele, (1996),it is in the interest of the buyer, but even more in the company interest,
that the purchasing negotiations achieve the best possible results by using means, and paths
that are proper and responsible, not only in the business sense, but also in terms of ethics

31
The questions that can be raise by a buyer to ensure that as much as possible ethically issues
are maintained in the negotiation process are:
i. How should confidential supplier price information be handle?
ii. How to deal with quotations:
iii. What is the maximum share are as customers want have in the suppliers turns
over, in order to prevent excessive decency on us?
iv. How far do we go in negotiations with suppliers?
2.9 NEGOTIATION PLANNING
From Ashcraft (2004), the need for planning is the foundation of any process, as a commercial
negotiation is crucial to its success of an organization.
Failure to plan properly often leads to unclear objectives setting for the negotiation process.
Also the use of inappropriate negotiates styles or tactics would result in not achieving the
goals of the party involve.
Through planning is the most important prerequisite to effective and efficient negotiation,
neither experience, bargaining skills, nor persuasion on the part of the negotiator can
compensate for the absence of planning. Before entering into formal negotiation with
potential suppliers, adequate preparation is essential to ensure that there is understanding and
knowledge of the issues involved.
As stated by Rich (2011) “Successful negotiation is 80 percent preparation”. Explains that the
importance of planning in negotiation is crucial – fail to prepare and you prepare to fail.
This is because at the stage of planning that is where there is the setting of objectives and
strategy of the actual negotiation.
Weele, (1996) proposes a ten-step approach to planning as:

32
- Establish the objectives of the negotiation for yourself.
- Gather facts that can have a big impact on the negotiations
- Assess the power position of each of the parties
- Determine the points of common interest
- Make a list of questions
- Define your tasks
- Decide on the composition and division of roles in your negotiating term
- Plan your concessions
- Agree upon the negotiating tactic you will follow
- Indicate how you think you will conclude the negotiations
Ninety percent or more of the time involved in a successful negotiation is invested in
preparation for the actual face-to-face discussions
From Burt et al (2003). The points or factors expressed to be taken during the planning stage,
the negotiator must:
Possess or gain a technical understanding of the item or service to be purchased.
Analyze the relative bargaining positions of both parties
Conduct a price or cost analysis
Know the seller
Be aware of culture nuances
In every conceivable and practicable way be thoroughly prepared.
To add to that copy and paste (process of negotiation Good 1/ negotiations skills)
2.10 WHAT TO NEGOTIATE

33
Zeng (1996), on issue of what to negotiate he states that “negotiation should include
discussions on quality and service elements as well as price” Lyson (2006), maintains that
what to negotiate is also known as the issues called the substance goods and depends on the
requirements to a specific situation. It indicates that negotiation takes place in request of high
valve items that is to say about 15-20% of inventory investment.
According to Leenders & Fearon (1993), any aspect of the purchase process can be subject to
negation. A few areas that negotiation is place on are quality, support services, supply issues,
transportation and price.
From the Queensland government Better Purchasing Guide (2000) outlines the followings as
what to negotiate on:
a) Technical support aspects – warranties life-cycle support or maintenance.
b) Financial aspects – deposits, payment terms, discounts, payment schedule, travel cost
or cancellation penalties.
c) Risk management aspects – bonds and financial guarantees, insurances, warranties,
type of contract used, service standard, liquidated damages clauses.
d) Management information aspects – access to information, reporting, documentation, or
attendances at progress meetings.
e) Government support aspects – government provided facilities and information or
access to government staff.
f) Timeframes – completion dates, delivery dates, milestones achievement or length of
contract.
g) Performance incentives
h) General matters including packing and freight, use of specified personnel or sub-
contracting arrangements.

34
It is after the above issues are negotiated, that it would then be appropriate to negotiate on
price.
Also the most common topical items which negotiations are undertaken are
i. Modification of price
ii. Terms of payment e.g. extended credit
iii. Mode and time of delivery
iv. Amendments to specification and delivery dates
v. Quantity, cash and trade discounts
vi. Packaging requirement e.g. palletization
vii. Allowances for the hearing factor and for scrap
viii. Compensation for cancellation of orders.
ix. Buyer remedies in respect of rejected goods or late delivery
x. Methods place of inspection and installation
xi. Methods of determining labour materials and overhead elements in cost type contracts
xii. Charges for use of patents owned by the supplier
xiii. Passing of property in the goods
2.11 WHEN TO NEGOTIATE
Burt et al (2003), negotiation is the appropriate method for determining the reasonableness of
price when competitive bidding or reverse auctions are impractical.
Also by Zeng, (1996), a buyer should be prepared to negotiate any time the buyer suspects that
the quoted price may be reasonable
In situations where there is a disagreement or potential disagreement between a buyer and a

35
supplier, to ensuring that the objective of public procurement is achieved, the appropriate
method to use is negotiation. Negotiation should be undertaken under circumstances or
situations in which the benefits to gain exceeds the anticipated cost associated in undertaking
negotiations.
Under Act 663 of Ghana, negotiation is not allowed to take place at the pre-contractual or
tendering stage but allowed at the post-tender stage with potential suppliers.
Whereas in the Jamaica case of the negotiated procedure, “direct negotiation is allowed under
the unsolicited proposals” (Handbook of public Sector Procurement Procedures, Section 1.2,
2010)
Looking at the EU procurement procedure, negotiated procedure is allowed with a single or
few selected suppliers but it has conditions attached (Directive 2004/18/EC)
Common circumstances during which negotiation is appropriate as by Burt et al, 2003 are:
i. When any of the prerequisite criteria for competitive bidding are absent.
ii. When many variable factors bear not only on price but also on quality and service.
iii. When early supplier involvement is employed.
iv. When the business risks and costs involved cannot be accurately predetermined
v. When a customer firm is contracting for a portion of the seller’s production capacity
rather than for a product the seller has designed and manufactured.
vi. When tooling and setup costs represents a large percentage of the suppliers total cost.
vii. When production is interrupted frequently because of numerous change orders.
viii. When thorough analysis is required to solve a difficult make-or –buy decision.
ix. When the products of a specific supplier are desired to the exclusion of others.
2.12 OTHER PROCUREMENT LAWS AND NEGOTIATION

36
Different countries have different guidelines on negotiation and public procurement. This
section considers how different procurement laws treat negotiation in relation with
procurement.
2.12.1 THE EU PROCEDURE
It is in two types:
 The negotiated procedure with publication of a contract notice
 The negotiated procedure without publication of a contract notice
The procedure calls for competition when the nature of the risk involved is such that it does
not permit prior overall pricing or specification cannot be drawn up with precision to allow the
open or restricted procedure. In that case a minimum number of three Tenderers is used.
However there are circumstances that a contract does not have to advertise and there is no
minimum number of Tenderers. The circumstances are;
a) For technical or artistic reasons or because of the protection of exclusive rights the
contract can only be carried out by one particular supplier.
b) Absence of suitable tenders in response to a previous invitation to tender using the
open or restricted procedure but only if the original terms of the proposal contract
offered in the discontinued procedure have not been substantially altered or there is a
need for extreme speed as a result of events unforeseeable by and not attributable to
the contracting authority.
c) When the rules of a design contest requires the contract to be awarded to the successful
tenderer or to one of the successful Tenderers provided that all successful tenders are
invited to negotiate the contract(Directive 2044/18/EC and 2004/17/EC of the
European Parliament, Public Sector Directive- Article 28,29,30 an&31)

37
2.12.2 JAMAICA PROCEDURE
Direct negotiation is allowed under the “Unsolicited Proposal (Handbook of Public Sector
Procurement Procedure section 1.2, 2010)
The procuring entity is at liberty not to oblige to entertain them (Unsolicited
Proposals/Tender)
The circumstances under which it may be considered by the procuring entity are:
 Demonstrate a unique and innovative concept, or demonstrate a unique capability of
the contractor.
 Offers a concept or service not otherwise available to the government and
 Does not resemble the substance of a recent, current or pending competitive tender.
Under section 1.2.1 of Handbook of Public Sector Procurement Procedure treatment of
unsolicited proposals, among the options is to “enter into the direct negotiation with the
proponent’’. Under Handbook of Public Sector Procurement Procedure section1.2.1.2, the
entity shall apply to the NCC through the permanent sectary for approval of the direct
contracting method.
Under the direct contracting procurement, is applied for contracts whose value up to $275,
00.00 and also permitted if the value which above $275, 00.00
2.12.3 THE NIGERIA PROCEDURE
Under the Nigeria Public Procurement Act 2007, negotiation means discussions to determine
the terms and conditions of a contract or procurement. Part VII Special and restricted methods
of procurement, under section 93(2)(5) “a procuring entity shall engage in procurement by
two-stage tendering” the procuring entity may, in the first stage, engage in negotiation with

38
any supplier or contractor whose tender has not been rejected under an open competitive
bidding procedure with respect to any aspect of its tender.
Also under section 41 (4) of the Nigerian Act, “no negotiation shall take place between a
procuring entity and a contractor or supplier with respect to a quotation”. With respect to this
section 41(4) of the Nigeria Public Procurement Act, 2007, it is in most respects same as that
of Ghana’s public Procurement Act, 2003 section 64(1) and also section 5.17 of the
Procurement Manual of Ghana.
The Nigeria procurement act, 2007 the explanation is that in situation where there is a
solicitation for negotiated contracts, the contracting entity as per requirements of the ppa, there
should be three separate quotations. Under section 51 “procedure for selection of proposal
where price is a factor” it states under section 51(7) “the consultants with the winning
proposal shall be invited for negotiation, which shall focus mainly on the technical proposals
and section 51(8) “the proposed unit rates for staff-months and reimbursable shall not be
negotiated unless there are exceptional reasons” this position of the law is same as of Ghana.
Under section 6.12 of the procurement manual of Ghana “negotiation of contract”, following
approval of the evaluation report and recommendations by the tender committee, the
procurement entity shall invite the recommended consultant for contract negotiation in
accordance with the procedure stated in the Request for Proposal (RFP). Section 6.12(3) of the
procurement manual of Ghana goes in direct relation with section 51(8) of the Nigeria public
procurement act, 2007.
Section 52 of public procurement act, 2007 of Nigeria “selection procedure where price is not
a factors, section 52 (2) “where the procuring entity elects to make a quality based selection, it
shall engage in negotiations with consultants in accordance with this section. This section
outlines what the entity shall do and also section 52(3) states what the entity shall do where

39
there is a failure in the negotiation process. Taking a look at the procurement manual of Ghana
section 6.13.1 “Award Notification” it sets out the grounds for such issues as in the Nigeria
situation.
2.12.4 THE UNITED STATES OF AMERICA PROCEDURE
FAR Section 811.104-75 allows the procedure for negotiated procurements. The procedure
prescribes that a contracting officer must go through from Section 811.104-70 to 811.104-75.
The clause 852.211-73 allows a contracting officer to use negotiated procurement where an
issue of Brand name or equal is to be adopted.
Chapter1: Federal Acquisition Regulation: Part 15: contracting by negotiation section 15.002
states the types of negotiated acquisition as sole source acquisition and competitive
acquisitions.
Chapter 19: United States Information Agency: Part 1910: specifications, standards and other
purchase descriptions. Section 1910.004-74: Procedure for negotiated procurements and small
purchases.
Also FAR6.401(b) gives the use of negotiated procedures for the proposed acquisition of
government needs which is most conducive and that it offers the government the ability to
maximize competition and obtain quality services at fair and reasonable pricing which goes
with the objectives of Act 663 of 2003 of Ghana section 64(2b).
Another view to this is 48 CFR 2.101, the termed “No-Bid Contracts” known as Sole Source
Contracts allows a government group after soliciting for a contract to go into negotiating with
the firm, the reason being that these contracts being negotiated enables quicken of the process
than the typical contract process. Although the law permits government to award sole source
contracts under specified circumstance 48 CFR CH 1 Part 6, the reason is usually due to cost

40
and urgency as such contracts are usually “urgent”. Comparing such a situation to that of
Ghana, there is some form of negotiation under the law where Single Source Procurement is
used as a procedure for procuring requirements as there some aspects of negotiation under this
procedure. Section 64 of act 663 of Ghana allows negotiation to be undertaken taking price
(cost) into consideration which is same as the condition under “No-Bid Contracts” where cost
is one reason for undertaking it. An example of Sole Source Contracts used by the United
States is in the case of the contract awarded to BLACKWATER and HALLIBURTON to
under security works relating to the Iraq War.
2.13 CONCLUSION
The literature reviewed, throws more light on the different opinions and application of
negotiation in public procurement in different jurisdictions. By this a sound theoretical
foundation has been established that in the researchers opinion will guide the study through to
a desirable outcome.

41
CHAPTER THREE
RESEARCH METHODOLOGY
3.0 INTRODUCTION
This chapter focuses on the choice of method of collecting and analyzing data.
The chapter presents the research design, describes the research methods, sampling methods
and the instruments employed in the data gathering
3.1 RESEARCH FRAMEWORK
According to Gay (1992) research design indicates the basic structure of a study, the nature of
the hypothesis and the variables involved in the study.
The researcher adopted the survey approach, particularly case study, and adopted quantitative
method, because quantitative method allows explanation of a phenomenon by collecting
numerical data that are analysed using mathematically based method, particularly statistics
(Aliaga and Gunderson, 2002 cited in Muijs, 2004).

42
It asses the procedures (conditions) under the public procurement, taking into consideration
the conditions under which it is allowed or not to undertaking negotiation by public sector
companies.
3.2 POPULATION/SAMPLE SIZE
Population is the entire aggregation of cases that meet a designated set of criteria (Polit &
Hungler, 1996)
In conducting a study, it is not possible, practical and it is sometimes expensive to gather data
by considering an entire population. Therefore smaller chunks of a unit sample are chosen to
represent the relevant attributes of the whole of the unit (Graziano and Raulin 1997)
There are so many public sector companies in the Western Region. The study was carried out
at five public sector organisations.
These entities are responsible for purchases, storage, distribution and transportation of all
commodities used in the execution of their various responsibilities.
Population is the entire aggregation of cases that a designated set of criteria. The target
population of the study covered the management of these organisations.
Sampling is a process of choosing the research units of a target population for which the
researcher included in the study. That is the process of taking a portion of the population to
represent the whole population. A sample size of 50 was used in conducting the research. Thus
fifty (50) questionnaires were sent out to the stakeholders.
3.3 SAMPLING METHODS
The researcher used Purposive sampling procedure to select the sample from the population. It
is a non-probability sampling method. This method was adopted due to the research being

43
within a defined area of the study and this allowed the researcher to choose respondents who
were in the opinion of the researcher relevant to the research topic. The researcher used
purposive sampling in selecting the size; this is because negotiation often covers only few
employees or staffs. It also allows the researcher to hand-pick cases to be included in the
sample as an appropriate strategy which satisfactory in relation to one needs.
3.4 VARIABLES OF THE STUDY
The independent variables are the dimensions of negotiation: preparation, planning, objectives
and laws governing its usage. These dimensions of negotiation by taking into account the
planning of negotiation and the expectations that parties are expected to gain from its
application in their dealings. Several varying number of items were developed to measure each
dimension.
The Public Procurement Act is the dependent variable that the study measures with the
independent variables. The Procurement Act is an indicator of the activities or process
undertaken by an organisation to getting or procuring its requirements in order to satisfying
the needs and wants of the public, in this case being the public sector companies in the
Western Region.
3.5 DATA COLLECTION METHODS
In undertaking the research, primary and secondary sources of data were used in order to
gather relevant information for the study. The primary data were obtained from selected
respondents at the study area. The study employed mainly questionnaires and face-to-face
interview in collecting the primary data and the analysis was based on the primary data. The

44
secondary data were obtained from existing literature which formed the literature review of
this study. The sources include books, journals, articles obtained from the internet and the
Takoradi Polytechnic library.
3.6 DATA COLLECTION ACTIVITIES
Administration of questionnaires was done personally by the researcher. This ensured that
answers were provided to all problems and help remove any difficulties that respondents
might encounter when answering the questionnaires. Questionnaires were administered on
one-on-one basis by the selected respondents at the various Headquarters of the public sector
companies.
The face-to-face interview was done personally and by telephone. It was on a one-on-one
basis, thus it enabled the researcher capture the reactions of respondents of questions posed to
them.
3.7 PILOT STUDIES
Questionnaires were initially developed and given to five respondents to verify whether the
questions are not ambiguous and were clear and to ascertain whether responses would be
consistent with the purpose of the study. Some questions were reviewed as a result of non-
response from the pilot study conducted. This was done to improve reliability and validity of
the questionnaires.
3.8 TRIANGULATION
According to Erina Audrey, (2013), triangulation also crosschecks information to produce
accurate results for certainty in data collections. It is used to indicate two (or more) methods

45
are used in a study in order to check the results. It’s used to increase the credibility and
validity of the results obtained.
Also, according to Denzin, (1978) (four basic types of triangulation) such as the
methodological triangulation it involves the using of more than one method to gather data,
such as interviews, observation, questionnaires and documents.
The data collection instrument used in this study is questionnaires and face-to-face interview.
This ensured that responses to the questions in the questionnaires enabled comparison to be
made with that of the face – to – face interview, thereby ensuring that responses received from
the respondents from both methods ensured reliability and validity of the information
received. It also ensured that questions which were posed in the questionnaires when asked in
the interview process where there were different responses to those questions enables a clear
interpretation to be made.
3.9 DATA ANALYSIS PROCEDURES
Analysis of data means the separation of the research data into its constituent parts. The study
employed both descriptive and inferential tools such as mean, mode and chi – square
respectively in analyzing the data. The data collected was edited and coded. The coded data
was then processed using Statistical Package Social Sciences (SPSS). Vivid commentaries
were made on the finding by making comparisons in order to make analysis of the data.
3.10 BACKGROUND OF THE AREAS OF STUDY
The study was carried out in the Western Region of Ghana which has a population of
1,924,577. The study was conducted in five (5) public sector organisations these are
Sekondi/Takoradi Metropolitan Assembly (STMA), The Regional Medical Stores, Ghana

46
Water Company Limited (GWCL), Ghana Supply Company Limited (GSCL) and Public
Procurement Authority (PPA).
SEKONDI-TAKORADI METROPOLITAN ASSEMBLY (STMA)
STMA is one of the eighteen districts in the Western Region. It started its humbly beginning
as most districts in Ghana. On 1st
October, 1903 it was proclaimed as the Sekondi Town
Council in the then Gold Coast Colony.
On 2nd
December, 1946, the Sekondi – Takoradi Town Council was established. In March
1954, the town council was elevated to a municipality status under the Municipality Council
Ordinance 1953.
The metropolitan current building was commissioned by Hon. A.E.A Ofori-Atta on Friday
18th
April, 1958 the then Minister of Local Government. It was in 1974 that the boundaries of
Sekondi-Takoradi were extended to include Ahanta and Shama Local Councils through the
new Local Government Act, LI 890 of 1971.
PNDC Law 207 evaluated the Sekondi-Takoradi City Council to a metropolitan assembly with
it name as Sekondi-Takoradi Metropolitan Assembly.
The metropolis currently has a population of 559,548 (Population and Housing Census
Report,mobile.ghanaweb.com/..../ population.php).and it is the fourth largest city and an
industrial and commercial centre.
Its mission is to exist to improve the living conditions of the metropolis through the provision
of sustainable socio-economic development and good governance that is responsive to the
needs of the people.
THE WESTERN REGIONAL MEDICAL STORES

47
The regional medical store is located in Takoradi sharing the same premises with the Takoradi
hospital (European hospital). It is the main medical stores responsible for the purchases,
storage, distributions and sales of health commodities to both private and governmental health
institutions in the region. It was a former military base/hospital built around 1921 used during
the slave trade/colonial era used mainly by white men as blacks were not allowed there. It
served as a base for the military during the first and second world wars. It was converted into
medical stores in 1966.
GHANA WATER COMPANY LIMITED (GWCL)
GWCL formerly Ghana water and Sewage Corporation was established on 1st July 1999 as a
stated owned limited liability company under the statutory corporations (conversion to
companies) act 461 of 1993 as amended by LI 1648.
The first public water system in Ghana, then Gold Coast was established in Accra before
World War I. It was managed by the hydraulic division of the public works department. The
water supply division was headquartered in Kumasi under the ministry of works and housing
with responsibilities for both urban and rural water supplies.
During the dry season of 1959, there was severe water shortage in the country. Following this
crisis, an agreement was signed between the Government of Ghana and the World Health
Organization (WHO) for a study to be conducted into the water sector development of the
country.
The study focused not only on technical engineering but also on the organization of a national
water and sewerage authority and methods of financing.
In line with the recommendations of the WHO, the Ghana Water and Sewerage Corporation
(GWSC), was established in 1965 under an Act of Parliament (Act 310) as a legal public
utility entity.

48
The main objectives of GWCL are;
 The planning and development of water supply systems in all urban communities in
the country.
 The preparation of long-term plans in consultation with the appropriate coordinating
authority established by the President;
 The conduct of research relative to water supply and related subjects;
 The making of engineering surveys and plans;
 The construction and operation of water works in the urban areas of Ghana;
 Submission of tariff proposals to the Public Utilities Regulatory Commission (PURC)
for review and final approval
GWCL Sekondi-Takoradi branch is responsible for these responsible of GWCL for the
Western Region. GWCL’s water supply system in Sekondi-Takoradi employs the five – stage
conventional water treatment process. The supply system is based on the Pra River as the
source of raw water. The water treatment plant is located at a village called Daboase, which is
close to the Pra River.( http://www.gwcl.com.gh/aboutus.php)
GHANA SUPPLY COMPANY LIMITED (GSCL)
GSCL formerly known as Ghana Supply Commission was originally established in 1960 as a
centralized procurement agency for the Government of Ghana. It was the main national buyer
for all Government Ministries, Departments and Agencies (MDAs) as well as State Owned
Enterprise (SOEs).
Over the years, however, the operations of the company have undergone tremendous changes
following amendments in the procurement laws and regulations which impact on the

49
company. In 1999 the company was incorporated under Ghana’s Company Code (1963) as a
Limited Liability Company, wholly owned by the Government of Ghana.
Its vision is to become a world class, cost and quality driven procurement and logistics
provider whose best reference is testimonial of excellence and satisfaction given by our
clients.
Its mission is to provide cost effective and integrated procurement and logistics service by:
 Safeguarding shareholders interest through maximizing shareholder value.
 Offering value for money on services to our clients.
 Creating a motivated and contended workforce.
 Promoting professionalism in the industry and
 Conducting business with uncomproming integrity and transparency.
GSCL has branches in Accra, Tema and Takoradi.
PUBLIC PROCUREMENT AUTHORITY (PPA)
In 1996, the government launched the Financial Management Reform Programme
(PUFMARP) to improve upon overall public financial management in the country. The
PUFMARP identified weakness in the procurement system. Thus in 1999, the government
established the Public Procurement Oversight Group. This was to steer the design of a
comprehensive public procurement reform programme. Thus through the efforts and support
of the World Bank, the Public Procurement Bill was drafted in September 2002. The bill
became an act on 31st
December 2003 when it was passed as act 663.
The Public Procurement Act established the Public Procurement Authority (PPA) when it
became effective/operational on 27th
August 2004.
The PPA roles and responsibilities are to:

50
 Sets procurement policy.
 Monitors compliance by procurement entities.
 Issues standard bidding documents.
 Suspends suppliers and manages bidder appeals.
 Coordinates capacity building and professionalization in public procurement.
 Manages and disseminates procurement information.
CHAPTER FOUR
DATA ANALYSIS AND DISCUSSION
4.0 INTRODUCTION
The chapter presents the result of the fieldwork conducted by the researcher. The result is
mainly the responses of the questionnaire administered to the various public sector companies
in the western region. Statistical Package for Social Scientists (SPSS) version 16.0 was used to
perform the analysis.
4.1 RESEARCH OBJECTIVES AND QUESTIONS
The objectives of the study are to:
 Ascertain the understanding of section 64 of the Procurement Act.
 Evaluate how section 64 is practically applied in procurement proceedings.
 Investigate the implications of section 64 on the outcome of public procurement
proceedings.

51
 Find out the level of compliance to the Procurement Act.
 Find out the relationship between negotiation and procurement.
 Assess the role of negotiation in ensuring value for money.
The following are the research questions posed:
 Is negotiation in public procurement an infringement of the Procurement Law?
 Does negotiation under Public procurement compromise the objectives of the
Procurement Law?
 Is there any relationship between negotiation and the intended benefits of the
procurement law?
 Does the Procurement Act limit the application of negotiation in enhancing value for
money in the public sector?
4.2 RESPONSES TO QUESTIONNAIRES
The questionnaires were administered to fifty (50) respondents in these public sector
companies in the Western Region. Out of the fifty (50) questionnaires administered, forty-five
(45) were obtained but forty (40) were valid for analysis while five were invalid as a result of
improper and double responses. The valid questionnaires which formed the analysis yielded
80% response rate.
4.3 ANALYSIS AND DISCUSSION
This section presents the analysis of responses received to the questionnaire administered to
the respondents. The section is divided into two main parts, namely the analysis of the

52
demographic characteristic of respondents and analysis of responses to questions on the
subject matter of the study.
4.3.1 DEMOGRAPHY – GENDER ANALYSIS
This section presents the analysis of data on the demography of respondents
Table 4.1 Gender analysis
Sex Frequency Percent (%) Percent (%) Cumulative Percent (%)
Female 25 62.5 62.5 62.5
Male 15 37.5 37.5 100.0
Total 40 100.0 100.0
Sourec: field-work, october 2014
Figure 1: Gender analysis

53
Source: Field-work, October, 2014.
A total of fifteen (15) respondents representing 37.5% of respondents were male and the
remaining twenty-five (25) respondents representing 62.5% of respondents were female. This
is illustrated in table 4.1 and figure 1 respectively above.
4.3.2 DEMOGRAPHY – EDUCATIONAL BACKGROUND
Table 4.2 Analysis of Educational Background
Educational
Background
Frequency Percent (%) Valid
percent
(%)
Cumulative Percent (%)
Secondary
Tertiary
Other, specify
7 17.5 17.5 17.5
27 67.5 67.5 85.0
6 15.0 15.0 100.0
Total
40 100.0 100.0
Fig 2: Educational Background - Source: Field-work, October, 2014.

54
As illustrated in table 4.2 and figure 2, the educational level of the sampled population ranged
between basic school holders to others qualifications levels: there was no respondent holding
basic level education. Seven (7) respondents representing 17.5% of respondents were educated
to the secondary school level, twenty-seven (27) respondents representing 67.5% were
educated to the tertiary level and the remaining six (6) respondents representing 15% of
respondents had others levels of education such as CIPS.
4.3.3 ANALYSIS ON USAGE OF NEGOTIATION IN PUBLIC PROCUREMENT
This section presents the analysis of data on responses to questions on the subject matter of the
study.
Table 4.3 Analysis of Usage of Negotiation in Public Procurement
Response Number of
respondents
Percent
(%)
Valid
Percent (%)
Cumulative
Percent (%)
Yes
No
38 95.0 95.0 95.0
2 5.0 5.0 100.0
Total 40 100.0 100.0

55
Fig 3: Usage of Negotiation Public Procurement - Source: Field-work, October, 2014
Table 4.3 and figure 3 illustrate the responses given to the question posed on, “Does your
institution use negotiation in the course of public procurement?”
Thirty-eight (38) respondents representing 95% answered “Yes” meaning that the usage of
negotiation by public sector companies in their procurement process is widely accepted by
these institutions. The remaining two (2) respondents representing 5% answered ‘No’
indicating the institution does not used negotiation in their procurement process.
4.3.4 STAGES OF PROCUREMENT PROCESS NEGOTIATION IS USED

56
Table 4.4 Analysis of Stages of the Procurement Process that Negotiation is employed
Response Frequency Percent (%) Valid Percent (%) Cumulative Percent (%)
At pre-tender stage
During the evaluation
of tenders
After evaluation of
tenders
During contract
management
18 45.0 45.0 45.0
8 20.0 20.0 65.0
11 27.5 27.5 92.5
3 7.5 7.5
100.0
Total 40 100.0 100.0
Fig 4:
Stages of Procurement Process that Negotiation is used –

57
From the responses, eighteen (18) respondents, representing 45% of respondents indicated that
negotiation is employed at the pre-tender stage of their procurement process, eight (8)
respondents representing 20% of respondents answered that negotiation is used during the
evaluation of tenders, eleven (11) respondents, representing 27.5% of respondents indicated
that negotiation is used after evaluation of tenders and the remaining three (3) respondents,
representing 7.5% of respondents answered that negotiation is used during the contract
management.
Most of the responses above contrast with the position of the procurement law (section 64(1))
of Act 663, which does not allow negotiation to be undertaken at the “pre-tender stage”, the
reason being that when negotiation is allowed during the procurement process it goes to affect
the principle of equality which supports transparency in the procurement process.
4.3.5 AWARENESS OF SECTION 64 OF THE PROCUREMENT LAW (ACT 663)
Table 4.5 Analysis of Awareness of Section 64 of the Procurement Law (Act 663).
Response
Frequency
Percent
(%)
Valid Percent
(%) Cumulative Percent (%)
Yes
No
37 92.5 92.5 92.5
3 7.5 7.5 100.0
Total 40 100.0 100.0
Source: Field-work, October, 2014

58
Fig 5: Awareness of Section 64 of the Procurement Law (Act 663).
Source: field-work, October, 2014.
From table 4.5 and figure 5, thirty- seven (37) respondents representing 92.5% of respondents
answered ‘yes’, indicating awareness/knowledge of the existence of Section 64 of Act 663 of
the Procurement Law of Ghana and only three (3) respondents representing 7.5% of
respondents answered “no’ indicating their lack of knowledge of the existence of this section
in the procurement law.
This implies that majority of institutions know of this Section in the Procurement Act. It is
only a small portion of respondents that do not know of its existences. It can therefore be
inferred that supervision or deliberate intentions may be the reason for the law not being
enforced during the procurement process.
4.3.6 IMPLICATION OF SECTION 64 ON NEGOTIATION

59
Table 4.6 Implication of Section 64 on Negotiation under Procurement Law
Response Number of
respondents
Percent
(%)
Valid Percent
(%)
Yes
No
14 35.0 35.0 35.0
26 65.0 65.0 100.0
Total 40 100.0 100.0
Fig 6: Implication of Section 64 on Negotiation under Procurement Law
This is illustrated in table 4.7 and figure 5 below indicate the responses when the question that
“Does Section 64 imply negotiations cannot be undertaken under any circumstance under
the procurement law?” was posed to respondents. Fourteen (14) respondents representing
35% of respondents responded “YES” that Section 64 implies that an entity cannot undertake

60
negotiation under any circumstances whereas the remaining twenty-six (26) respondents
representing 65% disagree that negotiation can be undertaken under any circumstances under
the procurement law.
It can be inferred that the minority understand the phrasing of section 64 “prohibition of
negotiation with suppliers or contractor” to mean that negotiation is not allowed under Act
663 whereas the majority appear to understand that it is only limitations/conditions that are set
to or guide the usage of negotiation as a procedure under the law (Act 663).
4.3.7 ANALYSIS ON COMPLIANCE TO SECTION 64
Table 4.7 Analysis of Compliance of Section 64.
Response Number of
respondents
Percent
(%)
Valid
Percent (%)
Cumulative
Percent (%)
All the time
Some of the time
Not at all
14 35.0 35.0 35.0
23 57.5 57.5 92.5
3 7.5 7.5 100.0
Total 40 100.0 100.0

61
Fig 7: Compliance of Section 64 - Source: Field-work, October, 2014.
For analysis of compliance with Section 64, 35% of respondents answered they comply with
the provision each time they are to undertake their procurement process, 57.5% indicated they
comply sometimes, while the remaining 7.5% answered they do not comply with this
provision in anyway.
The implication can be that the minority may be ignorant of that provision in the Act or also
that supervision might be inadequate.
4.3.8 SEEKING OF APPROVAL BEFORE UNDERTAKING NEGOTIATION WITH
SUPPLIERS/CONTRACTORS
Table 4.8 Analysis on Seeking of Approval before Undertaking Negotiation with
Suppliers/Contractors

62
Responses Number of
respondents
Percent
(%)
Valid
Percent (%)
Cumulative
Percent (%)
Yes
No
35 87.5 87.5 87.5
5 12.5 12.5 100.0
Total 40 100.0 100.0
.
Fig 8: Approval before Undertaking Negotiation with Suppliers/Contractors
From table 4.8 and figure 8, 87.5% of respondents answered they seek approval from the
Tender Review Board before undertaking negotiation with suppliers and/or contractors as per

63
instructions in section 64(2b) states. The remaining respondents representing 12.5% indicated
they do not seek approval, thus do not comply with this provision.
This implies a large majority of institutions comply with the dictates of the law in seeking for
approval before undertaking negotiation with their suppliers/contractors however a small
proportion do not comply and thus violate the law. If these are deliberate then they go to
defeat the objectives of the law as they provide grounds for influencing the procurement
process and sanctions are to be rigidly enforced to deter non-compliance.
4.3.9 ANALYSIS ON LOWEST EVALUATED PRICE BEING WITHIN BUDGET
Table 4.9 Analysis of Lowest Evaluated Price within Budget
Response Frequency Percent
(%)
Valid Percent
(%)
Yes
No
27 67.5 67.5 67.5
13 32.5 32.5 100.0
Total 40 100.0 100.0

64
Fig 9
Analysis of Lowest Evaluated Price within Budget - Source: Field-work, October, 2014.
Twenty-seven (27) respondents representing 67.5% say “Yes” when asked if “Does
negotiation as specified by section 64 of the Procurement Act yield the desired results of
bringing the lowest evaluated price within budget?” This implies that negotiation does ensure
that entities spend within their budgets a schedule which leads to institutions not over
spending or incurring extra cost which are unbudgeted for. That also means that Section 64(2)
and (2b) of the Procurement Law (Act 663).
The remaining thirteen (13) respondents corresponding to 32.5% response in the negative,
implying that it does not yield the results of gaining the lowest evaluated price within budget.
This might be due to factoring other cost factors in undertaking negotiation. This might in a
way increase the overall cost. This illustrates in table 4.9 and figure 9.

65
4.3.10 CONTRIBUTION OF SECTION 64 TO TRANSPARENCY IN PROCUREMENT
PROCESS
Table 4.10 Analysis of Contribution of Section 64 to Transparency in
Procurement Process
Response Number of
respondents
Percent
(%)
Valid Percent
(%)
Cumulative
Percent (%)
Very high
High
Low
15
22
3
37.5
55.0
7.5
37.5
55.0
7.5
37.5
92.5
100.0
Total 40 100.0 100.0

66
Figure 10 Contribution of Section 64 to Transparency in Procurement Process
From table 4.10 and figure 10 above 40% of respondents believe Section 64 ensures
transparency in the procurement process and as such very high in contributing to ensuring
equity. 55% of respondents see section 64 contributing very high to the objective of the
procurement act in ensuring that there is transparency in the procurement process. The
remaining 5% says that there less impact of section 64 in ensuring transparency in the
procurement process of public sector entities. This is illustrated in table 4.10 and figure 10
respectively.

67
4.3.11 SECTION 64 AND REDUCTION OF CORRUPTION
Table 4.11Analysis of Contribution of Section 64 to Reduction of Corruption
in the Procurement Process
Response Number of
respondents
Percent
(%)
Valid Percent
(%)
Cumulative
Percent (%)
Very high
High
Low
21
13
6
52.5
32.5
15.0
52.5
32.5
15.0
52.5
85.0
100.0
Total 40 100.0 100.0

68
Figure 11 Contribution of Section 64 to Reduction of Corruption in the
Procurement Process - Source: Field-work, October, 2014.
Twenty-one (21) respondents representing 52.5% agrees that section 64 as “Very High”,
thirteen (13) respondents corresponding to 32.5% rates Section 64 as “High” in the reduction
of corruption and the remaining six (6) respondents representing 15% rates it as low in the
reduction of corruption in the procurement process. The implication is that from the above it
means Section 64 has or is helping in achieving the objectives of the procurement law (Act
663) this is illustrated in table 4.11 and figure 11
4.3.12 SECTION 64 AND VALUE FOR MONEY
Table 4.12 Analysis of Section 64 in Ensuring Value For Money
Response Number of
Respondents
Percent
(%)
Valid Percent
(%)
Cumulative
Percent (%)
Yes 40 100.0 100.0 100.0
No 0 0 0 0
Figure 12 Section 64 Ensuring Value for Money - Source: Field-work, October, 2014.

69
From table 4.12 and figure 12, all forty (40) respondents representing 100% of respondents
answered that the provisions in Section 64 of the Procurement Act ensures value for money in
the procurement process for institutions. This goes to imply the importance of this section
towards the main objectives of the procurement law.
4.4 CONCLUSION
This chapter gave the analysis of the data obtained from the administration of the
questionnaires. Conclusions were drawn from the responses received from respondents. An
explanation of the analysis is done before tables and figures shown. From the study conducted
it can be concluded that for one question on the contribution to Section 64 to ensuring value
for money to entities 100% was had. The analysis of data was done using 16.0 Version of
SPSS.

70
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
5.0 INTRODUCTION
This chapter highlights the summary of the key findings of the research in relation to the
objectives of the study. Conclusions are drawn from the finding and recommendations are
given to help improve the understanding of Section 64 of the Public Procurement Act (Act
664) and how public sector institutions could adopt negotiation appropriately the procurement
of their requirements to realize the objectives of the procurement law.
5.2 SUMMARY OF RESEARCH FINDINGS
It has been observed that practitioners have knowledge of Section 64 of the procurement law
and its application is widespread. Negotiation in public procurement has enhanced the
objectives of the procurement law in terms of transparency, reduction in corruption, ensuring
that entities get the lowest evaluated price bid within their budget and also enhances value for
money for entities. The study has revealed that with the right application of Section 64 and
6.12 of the Procurement Act and Manual respectively there will be greater benefits to the
institutions and government.
It is also observed that the phrasing of Section 64 leads to confusions in the mind set of some
practitioners as they assume it to mean that negotiation is not allowed under the Procurement
Act.

71
The research analysis observed that there is still room for education/training to be done by the
PPA and public sector companies to bring up their procurement professional on the stance of
the law to usage of negotiation in their procurement process. Although there great findings the
almost all practitioners knows of the existences of sections which deals with negotiation in the
Act.
5.2.1 RESEARCH QUESTION ONE: “IS NEGOTIATION IN PUBLIC PROCUREMENT
AN INFRINGEMENT OF THE PROCUREMENT LAW?”
From the responses gathered from the study almost all respondents or practitioners have
knowledge of the existence of a section in the procurement law that talks of the usage of
negotiation and only very few did not have knowledge of it existence. This implies that
majority of institutions know of this Section in the Procurement Act. It is only a small portion
of respondents that do not know of its existences. It can therefore be inferred that lack of
supervision or deliberate intentions may be the reason for the law not being enforced during
their procurement process. Ignorance of that provision in the Act can also be a factor that
which leads to non-compliance of the law and thus and infringement of the law.
On whether negotiation is an infringement on the procurement law the majority (65%) did not
see negotiation as an infringement on the procurement law but only as conditions/limitations
only set out to be met before it adaptation in a procurement process as Section 64 provides and
also Section 6.12 of the Procurement Manual. The percentage that sees negotiation as an
infringement on the Procurement Law can be explained as due to the way Section 64 is titled.
With issue of compliance with Section 64 from the study it shows that there are greater
compliances as such negotiation can be said not to be an infringement on the procurement law.

72
5.2.2 RESEARCH QUESTION TWO: “DOES NEGOTIATION UNDER PUBLIC
PROCUREMENT COMPROMISE THE OBJECTIVES OF THE PROCUREMENT LAW?”
Findings in relation to this question can be better appreciated if considered alongside the
objectives of the Public Procurement Law, which are;
 Harmonising public procurement processes in the public service.
 Securing judicious, economic and efficient use of state resources.
 Ensuring public procurement is fair, transparent and non-discriminatory.
From the above objectives of the Act, negotiation does not compromise these objectives, in
that limits have been set to the usage of negotiation under section 64 of Act 663.
Pre-contract negotiation is banned from the European Union and the United States Laws as it
is seen as a way by which the objectives of transparency can be compromised and because it is
also good grounds for corruption. Provisions of section 64 of the Ghana Procurement Law is
made to have the same effect as the US and EU laws.
From the responses from respondents, negotiation does not compromise the objectives of the
Procurement Laws as the majority of respondents stated that negotiation ensures that the
desired results of bringing the lowest evaluated price within budget is achieved. The majority
of respondents also indicated that Section 64 ensures transparency to a very high/high in the
organisation’s procurement process.
Although most of the responses also contrasted with the position of the procurement law
section 64(1)) of Act 663, which does not allow negotiation to be undertaken at the “pre-
tender stage”, the reason being that when negotiation is allowed during the procurement
process it goes to affect the principle of equality which supports transparency in the
procurement process.

73
Responses also indicate that about half the respondents believed section 64 has an impact on
reducing the level of corruption. Findings also indicates that a large majority of institutions
comply with the dictates of the law in seeking for approval before undertaking negotiation
with their suppliers/contractors, however, only a small proportion do not comply and thus
violate the law. If these are deliberate then they go to defeat the objectives of the law as they
provide grounds for influencing the procurement process and sanctions are to be rigidly
enforced to deter non-compliance.
5.2.3 RESEARCH QUESTION THREE: “IS THERE ANY RELATIONSHIP BETWEEN
NEGOTIATION AND THE INTENDED BENEFITS OF THE PROCUREMENT LAW?”
From the study there is relationship between negotiation and the intended benefits of the
procurement law. This was observed from the analysis of the questionnaires, as in relationship
to ensuring value for money majority of respondents agreed that section 64 facilitated it. In
relation to reduction of corruption and ensuring transparency there were mixed opinions with
three quarters of the respondents indicating the impact was high to very high. For ensuring that
entities are able to us negotiation to ensure their desire of getting a lowest evaluated price
within budget majority of respondents agreed to that.
There exists a relationship as the Chartered Institute of Purchasing and Supply (CIPS)
opinions that Post–tender negotiation is an appropriate process to securing value for money
and the same situation is being encouraged by section 64 of Act 663. This is so because the
section is silent on restrictions of post-tender negotiation which means it is allowed but it is
strict on banning pre-tender negotiation which CIPS does not advocate for. In both situations
the reason being that it enhances clarification of point’s in contract documents.

74
From the Jamaican Procurement Law situation and that of the EU procurement procedure
negotiation exist as a procedure for procurement. The Jamaica situation talks of “Direct
negotiation allowed under Unsolicited Proposals and the EU is allowed with a single or few
selected suppliers but it has conditions attached to it as in the case of Ghana where it is also
allowed but with limitations with the application of negotiation as set out in section 64
“prohibition of negotiation with suppliers or contractor” which guides the usage of
negotiation as a procedure under the law (Act 663). From the above there exist a relationship
between negotiation and the procurement law.
5.2.4 RESEARCH QUESTION FOUR: “DOES THE PROCUREMENT ACT LIMIT THE
APPLICATION OF NEGOTIATION IN ENHANCING VALUE FOR MONEY IN THE
PUBLIC SECTOR?”
With respect to this research question, all respondents agreed that negotiation enhances value
for money.
Under the concept of procurement negotiation, the purpose of Public Procurement is obtaining
the best value for money. Also under post-tender negotiation it is the belief of the Chartered
Institute of Purchasing and Supply as is an appropriate process to securing value for money.
Negotiation also enables clarification especially in situation where bids appear low or high on
price, these clarification enhanced value for money.
5.3 RECOMMENDATIONS
Based on the analysis and the findings, the following are recommended to help improve the
challenges of the usages of negotiation by public sector companies.The way and manner in
which section 64 is phrased there is the need to do a re-phrasing of it to give a clearer

75
understanding of it so that practitioners would not assume on the face of it that procurement
negotiation is banned under the public procurement law.
Negotiation enhances the attainment of the objectives of Act 663 as such it is recommended
that the conditions spelt out in section 64 of the law and section 6.12 of the procurement
manual be followed to ensured that these objectives are attained.
It is recommended that PPA intensify its training, education and monitoring/evaluation of
students and practitioners on the Act 663 in the public sector on the usage of negotiation
especially the stage at which it can be used or adopted during a company’s procurement
processes.
Due to time constraints and conditions under which the study has been conducted it
recommended that the sample size be increased for future studies on this topic. Future
researchers are hereby called upon to conduct research to ascertain the level of usage and
impact of negotiation on public procurement in Ghana among public sector companies.
Finally it is recommended that negotiation as a procedure should be structured to enable both
students and practitioners avoid its constraints and learn it tactics to gain better results for
organisation as the law envisage.
5.4 CONCLUSION
The study presents a brief of the challenges of usage of negotiation by public sector companies
in the Western Region with respect to the Public Procurement Act (Act 663). The phrasing of
the section is misleading as it does not portray the real intent of the section. The conclusion
drawn for the whole research is that negotiation has an important role in the public
procurement sector and all efforts must be made to train procurement officers in the public

76
sector to understand the stance of the law on procurement negotiation and it strategies to
enable it to an effective tool in the procurement professional.
One can therefore conclude that negotiation ensures or enhances value for money from the
observation from the study.
Also conclusion is made on the way Section 64 is titled makes it problematic for some
practitioners who shy away from adopting negotiation because it seems to ban negotiations.
From analysis and findings it concluded that negotiation plays an important role in ensuring
that the goals and objectives of the Procurement Act to be achieved.

77
REFERENCES
1. Csaki Csaba (2006) Investigating The Decision Making Practice Of Public
Procurement Procedures “International Public Procurement Conference Proceedings
pp 21 – 23 (unilex.info/case.cfm)
2. Cohen, L. & Manion, L (2000) Research Methods in Education. Routledge 5th
edition
p254
3. Denzin, N. (2006) Sociological Methods - aASourcebook. Aldine.
4. Kai Kruger (2009) Negotiations In Tender Procedure: Undermining The Best Value
For Money – International Handbook of Public Procurement, edited by Khi V,Thai.
Boca Raton, Fla CRC Press pp 631-658.
5. Paul R. Schapper, Joao N.Veiga Malta & Diane L. Gilbert 2006, An Analytical
Framework For The Management and Reform of Public Procurement, Journal of
Public Procurement, Volume 6 Issue 1&3, 1 – 26 Pr Academics Press.
6. Peter Barron Stark & Jane Flaherty 2003, The Only Negotiating Guide You’ll Ever
Need, The Negotiator Magazine (www.negotiatormagazine.com/showarticial)
7. Queensland Government Dept of Public Works,(2000) Better Purchasing Guide
(ww,qgm.qld.gov.au)
8. Roger Fisher & William Ury, (1991) Getting to Yes: Negotiating Agreement Without
Giving in, New York, Penguin Books.
9. Stephen Ashcroft, (2004) Commercial Negotiation Skills, Industrial And Commercial
Training Vol 36 no 6 pp 229 – 233 (www.emeraldinsight.com/0019-7858.htm)

78
10. Thai, K.V. (2009). International Public Procurement: Concepts and Practices.
International Handbook of Public Procurement, Public Administration and Policy /
146 pages1-22
11. The Public Procurement Act (Act 663),2003, Ghana
12. The Public Procurement Manual, (2003),Ghana
13. The Public Procurement Act, 2004, Sierra Leone
14. The Public Procurement Act, 2007, Nigeria
15. Whiteford D.A, 2003, Negotiated Procurement “Squandering the of the Bargain”
Public Contract Law Journal,32(3) pp509
16. American Purchasing Society, http://www.american-purchasing.com/default.asp
17. www.mof.gov.tl/post-tender.
18. CIPS,www.post-tender negotiation/procurement .com
19. www.vlexGlobal/negotiation in procurement.com

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