MAKEREERE UNIVERSITY

BUSINESS SCHOOL
BACHELOR OF PROCUREMENTS AND SUPPLY CHAIN MANAGEMENT

INTERNATIONAL PROCUREMENT

GROUP WORK

NAME REG NO
SUMAYYAH A NAMUGENYI 18/U/7457/EVE
NABUKALU JAMIDAH 18/U/7381/EVE
NDAGIRE JANAT SHILLAN 18/U/7694/PS
KAWUMA ISHUBAH SHARIFAH 18/U/7440/EVE
MATSIKO NAPOLEON 18/U/24490/PS
Qn: As an expert in procurement and supply chain management, the international procurement
process used by Global Health Uganda.

Definition:
International Procurement refers to commercial transaction between a buyer and seller located in
different countries.

The following are the critics on the international Procurement process used by Global Health
Uganda;

Procurement planning and Budgeting: This is conducted by the Procurement and Disposal
Unit (PDU) and Board of Council of the Entity. Here the parties draft and allocate funds to
facilitate the procurement activities of the Organization. Therefore, the concerned parties of
Global Health Uganda have to make sure that there is a procurement plan and budget.

Need identification and specification: Every procurement begins with identifying a need and
this is usually done by the user department with the help of using their study coordinators or
managers as stated in the case. The procurement of the need has to be forwarded for approval
and it should be in line with the approved procurement plan and budget therefore Global Health
Uganda has to maintain this stage in its international procurement process since it’s very
important.

Assessment of market prices: Before coming up with specifications, Global Health Uganda
should carry out more research internationally in order to find out certain aspects for example the
prevailing market prices relating to the items to be procured like microscopes, freezers, oxygen
concentrators among others which also help in developing specifications.

Setting requirements: This is done by the user department and it indicates the items required
and the estimated prices attached as well. The requisition includes the specifications that are
approved by the user department therefore Global Health Uganda should maintain this stage in
its international procurement process because it helps the procurement and disposal unit to
understand about the items to be procured.

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Confirmation of available funds After submitting the requisition bearing the specifications, it
is forwarded to the accounting officer who confirms the availability of resources therefore
Global Health Uganda has to maintain this stage in its international procurement process.

Preparation of the bid documents: After the confirmation of available funds and determine the
procurement method to be used then the Procurement and Disposal Unit (PDU) prepares the
bidding documents that shall be sued when selecting the supplier therefore Global Health
Uganda has to include this stage in their international procurement process.

Seeking the necessary approval In this case, the Procurement and Disposal Unit (PDU) sends the
bidding documents to the contracts committee for approval and when it is approved the other
activities can proceed in the procurement process.

Developing a sourcing strategy As stated in the case, every business needs to determine where to
get their goods where by some companies have an approved vendors list that has gone through
the purchasers selection criteria while others are still trying to determine the best supplier and
they decide to invite the public for bids or use sourcing strategies like direct purchase and this
can is enabled through conducting market research in order to understand how the supply
markets work.

Evaluation and selection of suppliers: In this case, there is evaluation of the contacted supplier
basing on the submitted proposals. Under evaluation and selection, Global Health Uganda should
focus on the administration compliance like suppliers who have documents required, technical
compliance and others. After the evaluation, the suitable supplier is selected in accordance to the
procedures listed in the bidding documents there Global Health Uganda should select the
supplier before negotiation.

Setting terms, negotiations and sending the negotiation results: Here the Global Health
Uganda comes up with aspects like delivery terms of the products, specifying incoterms, among
others. After setting the terms then Global Health Uganda can negotiate with the best supplier
that has been selected so it involves the buying organization and selling organization until they
come to an agreement. And when the negotiation is done then the results are sent to the contracts
committee for approval and once the contracts committee approves, then the accounting officer
awards the contract.

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Contract award and implementation: during contracting, the purchase order is issued to the
supplier and also signing the memorandum of understanding. Global Health Uganda has to
maintain the supplier to ensure that the supplier performs as expected and if there is anything
differing from what is in the contract they discuss about it and correct it.

Delivery once delivered: the receiving company inspects the order and decide whether to accept
or reject the products. During this stage, Global Health Uganda should include the precautions of
delivering a damaged item. Still under delivery there are other activities like offloading of items,
inspection of items, issuing of goods received note among others.

Invoice approval and payment: like stated in the case study that documents must match when
the vendor wants payment which is the receiving document, the invoice and the purchasing
order. if there is any differences then it must be resolved before payment is made. Global Health
Uganda should maintain this since it calls for maximum transparency during all the procurement
transactions.

Contract performance and improvement: This is where Global Health Uganda evaluates and
rates the performance of the supplier which will assist in the future in case a similar need arises
and Global Health Uganda has to keep documents for every completed purchase. This is usually
done by users like laboratory managers, doctors responsible for the item procured to know if it
meets the standards and all specifications and if everything is as expected then Global Health
Uganda has to maintain close relationship with the suppliers.

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b)

The challenges faced by Global Health Uganda while practicing international procurement are
the following;

Risk mitigation; International procurement is associated with several risks like potential frauds,
delivery risks, compliance risks among others and Global Health Uganda did not have risk
management strategies to mitigate such risks as when they occurred.

Customs requirements: These are basically the requirements for one bring in goods across
boundaries. In this case, Global Health Uganda has to go through some authorities like Uganda
Revenue Authority, have legal documents to have their supplies delivered which delays their
operations.

Increased rules and regulations: Due to the various phases of industrialization in different
countries, industrial rules and regulations differ as stated by the government where by local
procurement rules are different from international rules which make global procurement
complicated.

Time differences: This is due to differences in the time zones across boundaries. Global Health
Uganda incurs more costs as it has to wait for suppliers in other countries to deliver goods thus
increased lead time.

Language and cultural differences: Global sourcing requires mutual respect be shown to
people, language and their culture of their countries where a company operates. Global Health
Uganda did not have technical staff and sales people with good English skills as a result there are
difficulties to interact with western experts.

Currency fluctuations: Since in global purchasing money has to be moved between domestic
countries and foreign partners. Global Health Uganda did not have experts to collect and manage
information on currency valuation thus instability in currency.

Cash flow issues: The payment usually takes a very long period of time especially with over sea
suppliers.

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Supplier related issues: which are also known as supplier management from identifying the
right supplier to keeping track of vendor performance and ensuring a stable supply of quality
products where the whole process is filled with complication.

Lack of Transparency poor flow of information: is a challenge faced by Global Health

Uganda this is because suppliers avoid disclosing too much information too many people which
affects the communication thus conflicts and misunderstandings.

Inaccurate data: In order to make procurement decision organizations need accurate and
reliable data. However for international procurement the buyer is prone to making purchases
based on inaccurate procurement data that can lead to inventory shortages.