Plan International Ethiopia SOP PIE-001/18 STANDARD OPERATING PROCEDURE PROCUREMENT Updated by: “Approved by: Ww < fS Mekdim Gullilat Abadi Amdu Head of Logistics & Admin Department | Interim Country Director [Endorsed by CLT Members — Annex I Latest updated date: June 20181 TABLE OF CONTENTS INTRODUCTION AND PRINCIPLES 1.1, Purpose of the Standard Operating Procedure, 1.2. Introduction 113. Principles of Supply 43.1. Child Protection 1.3.2. Gender and Equality 13.3. Conficts of interest 1.3.4. Transparency and Openness 135. Quality 1.3.6. Value for Money . 113.7. Procurement Ethics, Fraud, Brey, 1.3.8. Safety and the Environment 41.4, Plan's Values and Behaviours 1.5. Segregation of Duties 116. Donor Exceptions and Donor Derogations 1.7. Donor Eligibility Dates PLANNING 2.1. Project Operational Planning 22. Knowing our Markets 23. Cost Recovery and Funds Ma 231. CostRecovery 232. _ Grentand Funds Management 2.4, Annual Planning and Budgeting REQUESTING 3.1. Preparing Purchase Requisitions 1 3.2. Approving Purchase Requisitions 12 PROCURING 4.1. What is procurement and why do we dot? 42. Country Office Vs Program Area Procu 43. Opening a Requisition File 44. Procurement Methods 44.1. Direct Purchasing Method 44.2. Competitive Quotations Method 4.42.1. Re-use of Quotations 7) 44.3, Market Determined Tendering 7 44.3.1. Construction Tenders ere —— eee) 4.4.4 International Published Tendering : 7 oer “19 45. Long Term Agreements pee 20 48. Procurement Tracking : a 47. Supplier Checks and Ani-Teriorism Screening 2 48. Raising a Purchase Order 2 48.1, Tolerances — PR to PO 2B 49, Procurement Waivers cei Aa aes 24 410, Consultancy Services - 24 4.11. Supplier Management and Performance a 25 4.12, Special Requirements for the Procurement 25 Medical Supplies and Devices 4.13, Special Requirements for the Procurement of Food items ca 4.14, Emergency Response Logistics and Procurement 4.14.1. First Phase Emergency Procurement Thresholds. 4.14.2. First Phase Emergency Advertsing Periods RECEIVING 7 5.1. Checking and Receiving Daliveriog 5.2. Returning Materals to Suppliers ACRONYMS coon ANNEX1, INTRODUCTION AND PRINCIPLES 1.1. Purpose of the Standard Operating Procedure ‘The purpose of this Standard Operating Procedure (SOP) is to strengthen the internal control systems and promote accountability in procurement while at the same time ensuring the current procedures are better suited to the context in which the Plan International Ethiopia (PIE) currently operates This SOP have been adapted from the Global Logistics and Procurement Operational Manual (OM) updated on June 2017 and covers those specific process that have been tailored to the local context. All other sections of the Logistics and Procurement Operational Manual including the Annexes shall be implemented as per the OM. This SOP shall be reviewed, and updated regularly, as necessary, to ensure that it remains relevant to the organization's operations and in line with Global Logistics and Procurement OM. 1.2. Introduction Pian International has a single, standardised business process which covers the following areas of our P2P (Procure to Pay) process: Planning Requesting Procurement Receiving Disposal This standardised business process is summarised in the end to end P2P Process Map which can be found ‘on Planet and is also described in detail in this manual, including which steps are offline processes (e.g. tools and templates) and which are on SAP. The manual also includes guidance on ‘Adopted from the OM, this SOP covers the mandatory requirements for all Plan International Country Offices (COs), Regional Offices (ROs) and International Headquarters (IH). Additional process steps not described in this section may be unnecessary and cause inefficiencies and delay. In the event that you find contradicting information on a procedure, please immediately inform the process / document owners for correction. If you are unsure or would like any further support on implementing procedures for your logistics operations or advice on your specific grantdonor requirements, please contact your country office Logistics and Admin Department. The PIE’s Head of Logistics and Admin Department will contact IH for matters beyond the country's department through procurement@plan-international or ‘Any exceptions to the standard business procedures described must be approved in advance by the Country Director (CD) in country and then by the by the Head of Logistics & Procurement in writing, 1.3. Principles of Supply Plan International works with children, young people and communities to tackle the root causes of discrimination, exclusion and vulnerability. Children’s rights, and the rights of women and girls are at the heart of what we do and, as such, we must internally hold ourselves to the highest standards of integrity and professionalism. Logistics & Procurement is no exception and the following principles of supply apply universally:13. Child Protection ‘As an international child-centered community development organisation, Plan is committed to ensuring the fulfilment of children’s rights including thei hts to protection. Plan is committed to protecting children from harm and ensuring children’s rights. We take seriously our responsibility to promote child safe practices and protect children from harm, abuse, neglect and exploitation in any form. For Logistics and Procurement, this includes ensuring that no children are harmed, abused or exploited in any of our work or the work of our third Parties. In addition, we will take positive action to prevent those who abuse children from doing business with Plan and take stringent measures against any Vendors or other Associates who fail to comply with our child protection policies. 1.3.2. Gender and Equality Plan International believes that gender equality and inclusion are essential to achieve our vision. Plan International's Gender Equality and inclusion Global Policy both reflect the need to go beyond programmes and for each to become a cross-organisational commitment that is reflected in organisational structures, systems, policies and practices, Logistics and procurement guidelines, procedures, contracts and processes will wherever possible take into consideration gender equality and inclusion. Itis critical for those implementing this manual to systematically incorporate gender and diversity in day-to-day Logistics and Procurement activities, 1.3.3. Conflicts of Interest All employees and their relatives (partner, parent, child, grandparent, grandchild, sibling, uncle, aunt, niece, ‘nephew, cousin) must be able to demonstrate they are free of outside interests and activities that may impair their judgment in carrying out their duties, or that might influence them in acting in the best interests of Plan International. They must not be party to any business relationship with any organisation or person with whom Plan International does business, if that relationship creates a potential conflict of interest. Plan employees and their relatives are similarly not permitted to have an independent business relationship with any Plan International beneficiary, community sponsored child or family, or Plan Office Any Conflict of Interest or potential Conflict of Interest (including association) must be declared as soon as any individual is aware and may result in the removal of an individual from a process. This is to protect Pian International and our staff and to ensure the objectivity of the process, and aligns to Plan's values and behaviours to be open and accountable. 1.3.4, Transparency and Openness Plan International will maintain transparency throughout the procurement process, including ensuring that suppliers have equal opportunity to bid for our business. Confidentiality will also be maintained, including commercially sensitive information. All global tenders and their outcomes will be published on our website for a reasonable period of time. 1.3.5. Quality Plan International will assure as far as possible, that the goods and services we provide are of an acceptable quality standard which achieves our project outcomes.1.3. Value for Money This will consistently be a significant driver behind Logistics & Procurement decisions. Plan International are committed to driving down costs and to achieving the highest value for money for communities, sponsors and donors. Plan International will not, by default, accept the lowest bid in a procurement process but will instead award to the supplier or suppliers who offer the best overall value for money for the goods / services specified 1.3.7. Procurement Ethics, Fraud, Bribery and Corruption Plan has a policy of zero tolerance of fraud and corruption (see Anti-Fraud and Anti-Bribery and Corruption Policy), and requires staff and volunteers at all times to act honestly and with integrity, and to safeguard the assets for which they are responsible. Fraud and corruption are ever-present threats to Plan's assets and reputation and so must be a concern of all members of staff and volunteers, Plan takes the most serious view of any actual or attempted act of fraud or corruption by members of Plan staff, volunteers, Plan contractors or their employees, implementing partners and agents acting on behalf of Plan, Employees and volunteers involved in actual or attempted fraud or corruption of any kind will be subject to disciplinary action up to and including dismissal (if legally bound), and may be reported to law enforcement authorities for criminal prosecution. Plan will endeavour to recover, by any and all legal means, any funds lost through fraud from those responsible. Plan supports its staff to take a fim stand against fraud and corruption, and shall ensure that staff will not suffer from negative performance assessment, adverse employment-related consequences or retaliation, for reporting suspicions of fraud and/or corruption (refer to Global Code of Conduct Policy) or refusing to pay bribes. We actively encourage staff reporting any incidents or suspected incidents through Safecall. Plan purchases must be conducted with high professional integrity and personal ethics, Ethical behaviour includes not misusing resources, ensuring value for money, not receiving gifts, incentives or favours to conduct Plan related business and to deciare any and all conficts of interest. 1.3. Safety and the Environment Safety and the Environment will be considered in Plan’s Logistics & Procurement decisions, including assuring that, wherever possible, our Logistics & Procurement strives to do no harm and, further to assure the safety of our staff, communities and associates, 1.4. Plan's Values and Behaviours Plan's core set of values defines what is important to us. They outline how we should work to secure the change we want to see in the world and to achieve our purpose. They support the ambitious long-term goals set by our purpose statement, and guide how we can contribute to achieving the organisation's goals. We strive for lasting impact We are open and accountable We work well together We are inclusive and empowering § Se— i‘These values are at the heart of everything we do. Only by defining a common set of values that are important to us as an organisation — and that we also want to see in our partners — can we deliver shared goals. If we are to work towards achieving our new purpose, itis critical that we understand the behaviours that we need to demonstrate The values have been developed in close collaboration with staff from across the organisation and were approved by the Members’ Assembly in June 2016, meaning they apply organisation-wide Logistics & Procurement will seek to champion these values and behaviours and lead by example. We will Proactively identify areas to demonstrate the values and behaviours in our work and our interactions with others, and share and promote best practices with others. 4.5. Segregation of Duties Plan's policy is that actions in the procurement process must be segregated, such that no one person is doing or authorising all steps in the transaction. Mandatory segregation includes: 1) The Requisition Approver must not also release a Purchase Order for the same transaction, 2) The Purchaser must not also Receipt the Goods / Services for the same transection 3) Financial Payment must always be made by someone who has not approved the Purchase Requisition, Purchased the Goods / Services OR Received the Goods / Services for the same transaction Segregation can be achieved in one of two ways, depending on your office size and setup: Structural Segregation of Duties — in larger offices, you may find that you can have tasks in the procurement process permanently performed by different individuals. In other words, you do not assign conflicting user roles as described above and instead assign different individuals to the actions. This is always the simplest and most desirable option, but you may also wish to consider rotation of duties periodically to further reduce risk and protect staff. Transat ional Segregation of Duties ~ this is more common and requires individual accountability to ensure that individuals are meeting the segregation requirements. In transactional segregation, multiple roles may be assigned, and the individuals are held accountable for ensuring they do not conflict with the segregation of duties described above for each transaction. Even in tnis case, itis strongly recommended that the Financial Payment role is stil structurally segregated, ‘The most important principles to remember are: The person performing the task must be competent and qualified to do so. In other words, PR Approvers should be competent to approve the content and budget for a requisition. PO Releasers should be competent to validate that the procurement process has been followed and that the PO represents the best option for Plan. Receivers should be able to know that the goods or services have been received according to what was ordered or contracted. ae 6 WsThe person performing the task must not have also performed another of the three tasks in the transaction. In other words, the PR Approver must not also release the PO (and vice versa). Also the Receiver must not also have released the PO. In some cases the Receiver may also have approved the PR, but only if itis not possible to segregate this or if they are the only person who can certify as to the quality and condition of the goods / services received. 1.6. Donor Exceptions and Donor Derogations The majority of Pian International's institutional donor requirements are aligned to our intemal business process as described in this manual, so if you are following and compliant with these procedures, you will comply automatically with most donor requirements. However, some exceptions exist and will need to be handled carefully. You may need to approach a donor for a derogation before the start of, orat the beginning of a project, or you may need to follow different / additional regulations for logistics and procurement during your project. It's critical that any donor exceptions / derogations are considered early in the grant to avoid disallowed or ineligible costs, so please seek advice (if needed) early 1.7. Donor Eligibility Dates Knowing the eligibility dates for any grant is critical. Each donor is different, so it is important to check the eligibility dates, and what stages of the procurement process must be completed within those dates, and / or within the Project Dates. For example, most donors require all Purchase Orders to be raised within the eligibility dates of a grant, however some donors will further require all goods and services to be received within the eligibility dates as well. Most donors now recognise Long Term Agreements and Pre-Purchased Stocks where part of the procurement process has happened in advance of the grant eligibility dates, however, it is important to check this for each grant and, in all cases, itis critical to communicate formally with the donor at an early stage to flag where Long Term Agreements (LTAs) and / or pre-purchased stocks plan to be used. To ensure compliance to donor regulations it is required to involve Logistics and Admin Department throughout the project life cycle, starting from the design. It is also a requirement to provide access to the Funding Agreement Document (FAD stage 3) as a point of reference and compliance throughout the project periog. 2. PLANNING 24. Project Operational Planning Project Operational Plans (POP) must be developed for each Project. They form part of the DIP (Detailed Implementation Plan) as described in the POP (Programme Quality Procedures). As a minimum, the Project Operational Plan (POP) must contain’ Project Activities, their Locations, and the Dates for the Activity Delivery Goods, Services needed to deliver each Project Activity, ‘Schedule for the supply of these goods and services in order to meet the Project Activity Dates, which includes our internal and external supply activities and processes. & — oA 7‘A good POP should be a collaborative effort, which brings together Project and key practical Operational information into a realistic and achievable plan, identifies any possible constraints or delays early, and adjusts both project and operational planning accordingly. ‘Once agreed the POP must be regularly monitored and reviewed. Throughout a project, things change, and Plans need to be adjusted accordingly. A good POP will have several iterations throughout a Project and will result in better Project delivery. POPs are intended to be useful to both Project and Operational teams in planning their work and managing risks. Further details on how Operations can be integrated in the various stages of POP can be found in the PAP Library found on Planet. Particular emphasis need to be made in the preparation and provision of procurement plan by budget holders ‘and the need for consolidated procurement planning pericdically to allow the Logistics and Admin Department ‘administer bulk procurement and achieve value for money both at PA and CO level. 2.2. Knowing our Markets Planning in Logistics & Procurement includes having a good knowledge of our markets (local, national, regional, international) for the goods and services we will need to buy. As Plan International embarks on a new Global Strategy, we will also be embracing new categories of spend, expanding in some goods and services, and reducing in others. As we transition, we will each need to revisit our market assessments, and anticipate where we need to grow our supplier base and diversify. ‘As well as our new goods and services, we also have regular purchases where knowing our markets can help us buy better. Externally, understanding how markets fluctuate, including pricing and availability, can help us plan and buy better for our projects. Internally, knowing our demands on the market, anticipating with programme teams what needs are coming up in the projects, helps us to prepare and save time during those projects, such as Market Surveys, Registering Suppliers, going to Tender and getting Long Term Agreements in place ahead of time. 2.3. Cost Recovery and Funds Management 2.3.1. Cost Recovery Plan Cost Recovery and Funds Management guidance are designed to maximise all cost recovery potential for each donor, ensuring that all direct costs are covered and that all apportioned costs are identified and are recovered wherever possible. Plan has introduced a standardised procedure for cost recovery across Plan Inc., which will help us to manage our funding effectively. Areas relating to Logistics and Procurement include Grant and Funds Management; Vehicle Costs and Facilities Costs. Detail on the cost recovery of vehicles and facility aspects is detailed in the OM section 11.2.3.2 and 11.2.3.3 respectively. 4 SRE :a Grant and Funds Management Pian has developed specific guidance on how to be efficient and effective in acquiring and managing Funds and Grants. This guidance is designed to give direction during the four main stages: Acquisition Start Up Implementation Closure ‘At the Acquisition and Start Up stages of grant funded projects, its critical to consider a number of relevant areas in Logistics & Procurement: 1 Review donor contract clauses or additional guidelines on logistics & procurement to fully understand them and repeat the review once every year during the life of the funding Apply the same donor logistics & procurement compliance requirements to all funding sub- recipients and co-applicants. Ensure that donor logistics & procurement rules and regulations are understood. Donor rules and regulations if more stringent than Plan's override any established internal processes. ‘Check the following for any specific donor restrictions (see table below for more information): Is the item in the donor approved budget? If an item is not in the budget, re-budget and seek donor approval before proceeding, Will the donor allow the cost to be charged to its funding? If not, do not procure and charge it tothe donor. Note that some donors may stil require authorisation to proceed with procurement even though an item is budgeted for. Is the item on the restricted items list? Keep track of the types of restrictions: the items that may be allowed with prior written approval (if a donor had approved the item as part of the proposal), or items that are prohibited (cannot be allowed at all e.g. military equipment or alcohol, depending on the donor). Is there a donor limit on the item's cost? If so, follow the guidelines e.g. getting the right number of quotations to comply with the limitation. Are there any vendor restrictions? If so, make necessary checks on proposed vendor and if listed in an anti-terrorism system, choose another vendor. Does the quoted price fit within the approved budget? If not, re-evaluate vendors or change the budget by getting the donor's approval. 5. Complete all documentation and file appropriately, including updating the electronic asset inventory or register for equipment or other capital items. Note that if documentation is inadequate, Plan may be asked to refund the donor A‘Source and Origin Restrictions Vendor Restrictions Inventory/Asset Management Procurement Contract Management | Other Restrictions Carefully check the contract for any restrictions that Plan may have committed to comply with ‘Source refers to a location/country where an item is bought from Origin refers to where the item was manufactured If there are donor restrictions, procuring an item from a restricted source or one made in a restricted country will result in the expenditure being ineligible To avoid this, check what waivers can be obtained from the donor, when to do this, and how the donor requires this to be done, ‘Some donors will have an online database that detail prohibited vendors that Plan may not be allowed to procure from, such as USAID. Ifa donor requires vendor searches be conducted using a specific listing before Plan can procure a service or good, carry out the search and document the search as proof that a selected vendor is not restricted. In addition, follow Plan's internal process for vetting vendors as detailed in the Operations Manual Follow any donor rules including Plan's policy and procedures to document the existence of all assets procured using donor funds. As is part of established procedure, conduct regular physical counts and reconciliations to verify the existence of donor funded assets. Promptly notify a donor of any loss, theft or damage of asset bought with their funding Investigate, document and report all findings and place the report on the fund file. Refer to Plan's Operations Manual for more guidance. Carefully check the donor rules governing procurement contracts for goods and services, or commissioning works. The donor may require the use of specific procurement procedures for various levels of contract values. Examples could include local or international tenders, restricted tender or competitive negotiated tenders Plan must be assured that the contractor has performed in a manner that meets Some donors place restrictions on procurements related to international travel Note what other types of restrictions the donor may have, which may include which airlines are allowed, documentation to keep as proof of expenditure such as ticket, boarding pass and trip reports. File all these appropriately as good practice In trip reports detail where the staff went, when they travelled, why they travelled, who they travelled with, what was achieved, and state follow-up actions. More information can be found in other parts of this Logistics and Procurement operational manual but also in section 3.1.2.2 of the Fund and Grant Management Guidance document on Planet.2.4, Annual Planning and Budgeting As well as Project based planning, operational information must also be integrated into our annual planning and budgeting processes. Each year, the Annual Planning and Budgeting instructions will include specific guidance on how to budget for e.g. vehicle renewal, as well as what global LTAs are in place for COs and the pricing. Click on the link to find more details on the Giobal Annual Planning and Budgeting process and budget instructions. (On an annual or multi-year basis, Logistics teams should be consolidating Projects’ forecasted needs, as detailed in the Project Operational Plans and Project Budgets, so as to action key supply activities as early as possible. These may include, for instance, Long Term Agreements in place which can then be utilized across muttiple projects. 3. REQUESTING 3.1. Preparing Purchase Requisitions ‘The Purchase Requisition (PR) is our intemal document which defines what we need to buy and our specifications, how much budget is available to buy it and when we need it. Purchase Requisitions are often reviewed by a technical expert for those goods / services and must always be authorised in line with the Delegation of Authority (DOA) against their defined cost center / budget code. ‘After an overall budget is approved, the PR represents our instruction from a Budget Holder to a Purchaser to buy the specific goods or services we need for our Project Activities. Purchase Requisitions must include: Description of goods / services, specification, quantity Maximum Budget available to spend Cost Centre / Budget Code and WBS Requested Delivery Date Purchase Requisitions should include enough specification to go to market but be open enough to allow ‘equal opportunity to supply, for instance not specifying a specific supplier, brand, model, type unless there is no other way to describe the goods / services. Purchase Reauisitions in Plan are prepared and approved in SAP. The SAP guidance available includes the following courses in Learn at Plan: Cres Requisition (MES1N) ‘Changing a Purchase Requisition (ME52N) Displaying a Purchase Requisition (ME53N) Listing Purchase Requisitions (MESA) Approving a Purchase Requisition (MES4N) Collective Approval of Purchase Requisitions (MESS) ae : 1g a Purcha’3.2. Approving Purchase Requisitions Purchase Requisitions must be approved in line with the country’s authorization level / Delegation of Authority given by the Country Director (CD) adhering to the Financial Authority Approval Limits Policy (FAL) December 2016. Limit per Transaction | Limit per Transaction SAP Role _|Role (Euros) (ETB) Unlimited (also approved| Unlimited (also approved REQ_APPRS | CEO by Chair if over €10m) _ | by Chair if over ETB 240m) Intemational Programme Unlimited (also approved | Unlimited (also approved REQ_APPRT | Director by Chair if over €10m) _ | by Chair if over ETB 330m) REQ_APPR6 | Regional Directors Up to €2,500,000 Up to ETB 82,500,000 REQ_APPRS | Country Directors: Up to €1,000,000 Up to ETB 33,000,000 REQ_APPRS | IH Executive Team Directors | Up to € 500,000 Up to ETB 16,500,000 REQ_APPR3 | Country Sub-delegates Level 3 | Up to €250,000 Up to ETB 11,550,000 REQ_APPR2 | Country Sub-delegates Level 2 | Up to €200,000 Up to ETB 6,600,000 REQ_APPRT | Country Sub-delegates Levelt | Up to €50,000 Up to ETS 1,650,000 Note: The above limit per transaction is directly adopted from the global Logistics OM and the country will use it to cap the maximum allowable limits in compliance to the the FAAL. Every approval for PIE, however, should be in line with the DOA of Plan International Ethiopia that can be revised from time totime. Prior to Approving a Purchase Requisition, the authorizer must check the following: Are the goods / services correctly described? Is the quantity correct? Is the maximum budget available correct? Are the WBS, Cost Centre, Project and Donor Grant Reference information correct? If a Purchase Requisition value exceeds the approver's authorisation limit, it must be escalated up the management line to a Purchase Requisition Approver with sufficient authorisation (soo tablo above). 4. PROCURING [ Management Standard LP1: Plan’s supply needs for goods and services are anticipated and sourced by procurement professionals, with effective processes that adequately control and manage risk. | 4.1. What procurement and why do we do it? Procurement is the specialist activity which translates Plan’s budgets into the materials, services and activities needed to deliver Plan's programmes and achieve our strategic outcomes, 2Procurement is about managing our resources in the most effective way possible, working proactively and strategically with extemal markets to deliver the best value for our donors and our sponsors and the best results for children and girls. 4.2. Country Office Vs Program Area Procurement Wherever possible, field and country offices should purchase material on the national market to support local development and business, ‘Where materials are not available, or are too costly locally, or are of below standard quality the request should be forwarded to the country office. Despite the above factors, procurement of the below items are restricted at country office level. Furthermore, the corresponding brands are specified to ensure compliance to the global practice of PIE, available quality to the country’s context. 1 Vehicle TOYOTA co 2 | Motorcycle NA [co 3 Consultancy Services | N/A co SSS ie 4 Generators. NIA co 1 Laptop 1.HP EliteBook 820/840 or Equivalent with Windows 10 co (Global Standard) 2. Core i5/i7 Processor with 8 GB RAM 3. 500 GB HDD, DVD RW, 3 years warranty 2 Desktop Dell/HP Desktop Computer with Core i3/i5 processor, co Windows 10 and 4 GB RAM, 500 GB HDD, DVD RW. 3 Server Dell/HP with 16 GB RAM, |.5 TB HDD, Dual Intel 2.1 co. | aa | 4 | Photocopier ‘Canon IR 2520 or Equivalent photocopies COTPA 5 Network Printers HP LaserJet M600 DN series eee “| COTPA” 6 Color Printer HP Color printers ( no specific models yet) COTPA 7 External Hard Disk Transcend/WD 1000 GB/ 1 TB COTPA 8 Flash Disk 16 GB/32 GB CO/PA 9 Internet Dongle ‘3G/4G Huawei, ZTE or other Ethio Telecom approved CO/PA brands 10 ‘Scanner HP Scanner with Automatic Document Feeder (ADF) CcO/PA 11 UPS APCIBPC/EATON UPS from 650 VA to 5000 VA CO/PA 12 Tablets ‘Samsung Tabs with Wi-Fi and mobile data functional co 13 Projectors Epson, Sony or other known brand projectors with CO/PA HDMI, VGA and other ports Note: For the ICT Equipments that can be procured, technical verification / evaluation of the process by IT professional is mandatory. +,4.3. Opening a Requisition File ‘As soon as an authorised and actionable Purchase Requisition is received by a Purchaser, they must open @ Requisition File using the Requisition File Checklist as a front cover sheet, All relevant documents relating to the transaction must be retained (e.g. quotations, emails, advertisements, ToR, Specifications, Supplier Questionnaires, Supplier Accounts, signed contracts and Purchase Orders, Goods/Services Receipt Note (GSRN). Wherever possible, all documents should be made into PDF files and uploaded into SAP for retention. Only PDF files can be uploaded into SAP. Original hard copies of documents should also be retained for audit purposes. Archiving plans must be in place for all offices to ensure that documents relating to Procurement are retained for a minimum period of seven years after the Project Closure Date, or the Final Project Payment Date from the Donor (whichever is later) OR longer if required by local legislation. Unsuccessful bids / quotations must also be kept for this period. Archiving must adhere to Plan's Retention, Storage and Destruction of Key Documents Policy 4.4. Procurement Methods For normal business operations, the procurement processes set out below must be applied as determined by the actual or anticipated value of the purchase, as stated on the Purchase Requisition: Procurement Method Limit (Euro) Limit (ETB Direct Purchase (Simplified) Below €75 Below 2,500 Direct Purchase (Single Quote) €76 - €550 2,507 - 18,000 Competitive Quotations (Three Quote) | €551 to €12,000 18,007 - 400,000 Competitive Quotations (Five Quote) _| €12,007 to €30,000 _| 400,001 - 1,000,000, Market Determined Tender (MOT) €30,007 to €150,000 | 1,00,001 - 5,000,000 International Published Tender (IPT) _ | Above €150,000 5,000,001 - above ‘Note TEure = SETS To responé to the specific nature of acquiring consultancy services in Ethiopia, the following threshold shall specifically be used for consultancy service procurements. Details consultancy service procurements can be referred at Annex I SOP PIE-004/18 Procurement of Consultancy Services Limit (Euro) I Limit ETS Direct Purchases (Single Quote) =| Below€2000 —S=_—| Below60,000 jompetitive Quotations (Five Quote) ©2004 - €20,000 0,004 — 600,000 jarket Determined Tender (MDT) *€20,001 - €150,000 | 600,001 - 5,000,000 international Published Tender (IPT) ‘Above €150,000 ‘Above 6,000,007 jote: Quotation shail be solicited only from prequalified consultancy firms. ——S—4.4.1. Direct Purchasing Method Below ETB 2,400 Up to a maximum transaction value of ETB 2,400 a reduced process is permitted, whereby a Purchase Requisition, Quotation and Purchase Order are not formally required and email request can be used to initiate requests. This process should only be used where a post-payment method is not possible, for instance for sundry office expenses and travel related expenses which can only be paid at point of purchase. Such transactions must be minimised and follow the Petty Cash (OM 06.12) and / or Travel Expenses (OM9.05) guidance accordingly and, in all cases evidence retained of the spend. From ETB 2,401 ~ 18,000 The Direct Purchasing Method may be applied up to a maximum transaction value of ETB18,000. Each transaction must be initiated with an approved Purchase Requisition. One or more quotations are then sought from the market for the required goods / services. The budget holder, PAM/ HoLA or delegate can open the quotations. After analysis of the quotation(s) obtained, a Purchase Order is raised and releases to issue to the supplier. If only one quotation is received, and the Purchaser is not satisfied that this represents best value for money for Plan International, they should obtain further quotations, if necessary accessing outside markets to do so, 4.4.2. Competitive Quotations Method Three Quotation Level: ETB 18,001 - 400,000 For purchases in this category of Competitive Quotations method, a minimum of 3 Quotations must be obtained and it is encouraged to seek more quotations for a more robust competitive analysis. Five Quotations Level: ETB 400,001 — 1,000,000 For purchases in this category of Competitive Quotations method, a minimum of § Quotations must be obtained. The Competitive Quotetions Purchasing Method can be epplied up to a maximum transaction value of ETB- 1,000,000.- based on the categorization above. It is a procurement method where Plan International obtains € pool of quotations from the market to meet our specifications for goods or services. The aim of this process is to attract a competitive but manageable pool of quotations to analyse and then select the supplier(s) who represent the best overall value for Plan according to our selection criteria. In this procurement method it is always encouraged to seek out more quotations for a more robust competitive analysis. Quotations must be reviewed by the procurement committee (one of whom can be the Purchaser) and selection reason(s) given in a Quote / Bid Comparison Sheet, signed by the committee who have reviewed the Quotations. Any Conflict of Interest or potential Conflict of Interest (including association) must be declared as soon as any individual is aware and may result in the removal of an individual from a competitive process. This is to protect Plan International and our staff and to ensure the objectivity of the procurement process, and aligns to Plan's values and behaviours to be open and accountable.Quotations must be evaluated against a set of objective and balanced criteria. Criteria must be set at the beginning of the procurement process, and determined by the business needs and the type of goods / services. Example criteria include: Quotation Evaluation Criteria 4. Specifications (e.g. Not Met / Partially Met / Met / Exceeded) Additional features / Services (beyond minimum specification requirements) Quality Pricing and overall Value for Money Supplier Performance / References (including performance on comparable contracts) Availabilty / Lead Time / Delivery Conditions. Advertising can be determined by the market and the goods / services being sought, however, all suppliers must be given the same information, or the same opportunity to obtain information, throughout the process. ‘Suppliers must be given enough time to prepare and submit their quotations. Quotations from suppliers must be in writing, it can be on company headed stationery or on RFQ form send to the supplier or a company authorised email address. All quotations received must be retained and filed, except ifthey are received after the closing date, in which case they should be returned promptly to the supplier. Regardless of value, no contract with a supplier should exceed a maximum duration of 3 years. At this point, ‘a completely new process must be initiated and advertised openly and accountably. 4.4.2.1. Re-use of Quotations Plan International discourages re-use of quotations for later purchases as they are only valid up to the ‘maximum quantity and description of goods / services that was originally requested. Purchasers should anticipate and consolidate needs wherever possible and go to market to obtain higher volume quotations Considering the market context of Ethiopia where by price increases are evidently happening, re-use of quotations are accepted as per the conditions set below. Re-use quotations involves purchasing the same goods and services from the same supplier with the same terms and prices. The Procurement Officer should clearly state on the RFQ or ITB the length of time quotations should be valid for (e.g. 30 days, 60 days etc.). Should a requisition be made for the same item a second time within the validity of the quotations received, this may be procured from the same supplier without the need for a new bid i.e. Re-use of quotations. ifthe validity of the quotation has expired a new bid must be carried out, unless the vendor agrees to apply the same prices from the expired price’s validity. Re-use of quotations shall be endorsed by the Procurement Committee before use and quotations should not be re-used more than two times. Re-use of quotations for more than two times shall be and additional reuse should be approved by PAM or HoLA and in any case shall not exceed that four times. a tet 16‘Quotations can be re-used for bids that are not more than 90 days old and the reordering must be for procurement threshold of same level or lower. If the initial order is for tender, then the reorder can be done for tender level and lower thresholds. However, order placed for instance for 3 quotations cannot be repeated for tender level procurements. Alternatively it is preferable to set up LTA where possible for any items that PIE is likely to procure several times in the course of a year. See Long Term Agreement section below for further guidance, 4.4.3. Market Determined Tendering From ETB 1,000,001 — 5,000,000 ‘The Market Determined Tendering (MDT) Procurement Method can be applied up to a maximum transaction value of ETB 5,000,000. This method is a full tendering process where the level of advertising is determined by the market. For example, there is no formal requirement in this method to advertise internationally if the Purchaser is confident that a competitive pool of Tender Bids can be obtained in the national market, via printed media, radio advertising, targeted supplier invitations ete The method and level of advertising are determined by the market(s) for those goods and services, but must achieve a sufficiently competitive poo! of at least 3 bids. In most tenders, it is typical to receive considerably more than this, often in the region of 10 bids initially. Advertising method must be clearly documented and justified and if insufficient bids are received for competitive comparison, tenders must be re-advertised, so it is critical that Purchasers consider carefully before deciding on the level and method of advertising. The advertising period for Market Determined Tenders is recommended, wherever possible, to be at least 30 calendar days, but in all cases must be at least 14 calendar days. The number of days must be long enough to allow interested bidders a reasonable and appropriate time, taking particular account of the complexity of the tender. ‘As with any procurement, the MDT must be initiated by an authorised Purchase Requisition. Once the Specification for the goods / services required has been prepared and attached to the PR. ‘A Procurement Committee (PC) appointed by PIE's Country Director shall convene to evaluate tenders to analyse and compare the bids received. The PC should include a Purchaser of sufficient level to release the total value of the procurement In some cases, expertise might be beneficial from outside the CO, for instance in this case if a Purchaser or Programme Manager from another CO / Region / IH has had experience in sourcing a similar construction project previously. These Co-opted members can then join remotely, but must still be present (e.g. via teleconference) for all committee discussions. It is important to have the right PC composition to make the appropriate decision on the procurement. The composition of a PC must be sufficiently qualified to consider all aspects of the purchase. The PC members must not be in management relationships with other Procurement Committee members. PC members should be qualified and experienced to review the purchase and make the best decision for Plan — this does not mean committee members all have to be, or include CLT members, neither does it mean that members need to be all of a similar level in the organisation. aAs above, any Conflict of interest or potential Conflict of Interest (including associ \n) must be declared as soon as any individual is aware and may result in the removal of an individual from a competitive process. This is to protect Plan International and our staff and to ensure the objectivity of the procurement process, and aligns to Plan's values and behaviours to be open and accountable. ‘Suppliers must be given the same information, and / or the same opportunity to obtain information. Closing dates must be clearly communicated in the invitations to bid and / or advertisements. All bids must be received in writing and sealed. Tenders may also be received electronically, but must follow strict controls. If you plan to receive electronic tender bids, please contact procurement@plan-international.ora for specific advice on this, as it may be necessary to also inform your donor prior to tender advertising Procedures must be in place to make sure that tender bids are not tampered with in any way and that confidentiality is maintained. Bid opening must be independently witnessed and documented in the Tender Opening Log. Itis the responsibility of the Procurement Committee to be present and witness all bid opening, As above, bids must be evaluated against a set of objective and balanced criteria which help Plan International to achieve the best outcomes. Criteria should be set at the beginning of the procurement process, and determined by the business needs and the type of goods / services, During two envelope tendering procedure, only the technical proposal envelope shall be opened during the opening. Members of technical proposal evaluation team are assigned by Head of the requesting departments as well as PAM in case of the program areas. The financial offer envelope shall be opened as a2” stage later for bidders who pass the technical evaluation stage. For transparency purposes, PIE encourages participation of government representatives from concerned offices in the evaluation process especially for procurements: Medical Equipments, Medical Drugs, Seeds. Livestock, Construction... ete Any and all committee meetings must be documented, and selection decisions, scoring and any other reasoning for selection must be summarised in writing and physically signed by all Procurement Committee members, for example in the Bid Comparison Sheet. The committee makes the final decision on the supplier selection, not (as previously) @ recommendation. The committee's decision is final and subsequently, the Purchaser will release the Contracts and / or Purchase Order to the supplier in accordance to the committee's decision. All bids received must be retained and filed, except if they are received after the closing date, in which case they should be returned promptly to the supplier. Regardless of value, no contract with a supplier should exceed a maximum duration of 3 years, ZI 84.4.3.1. Construction Tenders PIE Construction tenders should be based on the standard construction bidding document that is in line with the Ethiopia's construction laws and requirements (Annex VI). Tenders for construction shall be endorsed by the CO Construction Supervisor before commencement of the process. Construction Tenders follows a two envelope process. During tender opening only technical proposals shall be opened for evaluation by technical team versed with the country’s construction requirements. It is also advised to conduct the tender evaluation in the presences of the CO's Construction Supervisor. For transparency purposes, PIE highly encourage participation of government representatives from concerned offices in the evaluation process. The financial proposal shall be opened for bidders who passed the technical evaluation stage. 4.4.4, International Published Tendering Above ETB 5,000,001 Above ETB 5,000,001 the International Published Tendering (IPT) method must be followed. This method is the same as the MDT method above, but with the exception that, regardless of the goods / services being sought, in all cases these tenders must be advertised internationally, including national media (print or electronic), regionally (where appropriate) and on the Plan International tenders website hitos://plan- international orgltenders. The Central Procurement team at IH will support you in the advertising of this tender, the collation of bids and, as needed, throughout the remainder of the tender process. The advertising Period for International Published Tender must be for @ minimum of 30 calendar days. IPTs must follow the Tendering process outlined above in section MDT above. ‘As above, regardless of value, no contract with a supplier should exceed a maximum duration of 3 years. At this point, a completely new process must be initiated and advertised openly and accountably. Quotations / Bids must not be re-used for later purchases, as they are only valid up to the maximum quantity and description of goods / services that was originally requested. Any new requirements arising after a recent quotation must go back to market to request new quotations. To avoid supplier fatigue, purchasers should anticipate and consolidate needs wherever possible and go to market to obtain higher volume quotations. See Long Term Agreements section guidance below for additional support Procurement Watiod Ti ETB) [= Por | Suppier pr | RO Comparison| Contact| inveice | SF | ‘Direct Purchase (Simpified) —__—_—~| Below 2500 NOW [NO [No [NO [ves | ves ‘ier Purchase (Saale Qua) Fe NO YES [VES [VES ‘empetive Guciations Tree Guo) | T8001 400 000 [YES | Winimam ves___[ves [ves [ves ‘Competitive Quotations (Five Quote) | 400,007 1000,000_| YES | Minimum & ves___[ves_|ves_| ves] ‘art Determied Tender (WOT) | 160.0076 0000000 YES | Rational Tender | ves | ves [ves [YES | international Pubiahed Tender (PT) | 5000001 abave | YES | Iwemalional Tender | VES | eS [YES VES =e 194.5. Long Term Agreements ‘A Long Term Agreement (LTA) is a formal contract between Plan International and a supplier / suppliers under which repeat purchases of goods / services can be made over a fixed period of time. LTAs are awarded after a full competitive process has been followed, as determined by the total anticipated ‘spend over the duration of the contract. For example, an LTA for workshop and office stationery might be for 3 years and with an estimated maximum spend of ETB 200,000 over the contract. This would need to follow the Competitive Quotations process described above, but suppliers will be asked to quote for the LTA Similarly, an LTA for cement for 3 years might be estimated at a maximum spend of ETB 2million over the contract. This would need to follow a full Tender process as described above. In cases where it is difficult to estimate the maximum spend, itis advised to follow the MTD process that gives a flexibility maximum spend within the MTD threshold. In all cases the suppliers must be made aware at the beginning of the process that an LTA is being sought. The Request for Quotation (RFQ) or Invitation to Tender (ITT) document and Tender Dossier must clearly state the terms of the potential Long Term Agreement, including the dates and an anticipated volume of spend / quantities of goods without committing to a minimum volume. At award of contract stage, all Long Term Agreements must include: Maximum Total Quantity / Volume of Goods / Services valid under the contract Maximum Total Financial Value of the contract Contract end date (which must not exceed 3 years from the date of signing) Wherever possible, LTA contracts awarded should be signed on a non-exclusive basis and must include supplier performance related break clauses. When an LTA is active, Purchase Orders may be drawn against it without a further competitive process. However, during the period of the LTA, if the total LTA value OR if the total LTA Quantities are exceeded, a ew full and competitive tender process must be initiated with new forecasted requirements, If you wish to conduct an LTA process, we recommend you seek technical support from the Central Procurement team. Where you plan to use an active LTA as part of a grant funded project, it is strongly advisable to contact your donor(s) before any procurement takes place to inform them that you plan to Purchase under an LTA. The Global Logistics & Procurement team can advise you on templates to use for this communication Please note, Plan Intemational does not have ‘preferred suppliers’, only LTA Suppliers according to the precise conditions above, 2046. Procurement Tracking ‘The Procurement Status Report (PSR) (Annex Ill) forms the main document for tracking and reporting on Procurement. Itis created and managed by the Procurement Unit, and is an internal document. ‘The tracking sheet allows recording of key information about each item requested and provides the Procurement Officer with a means to view all requisitions in one sheet. The status column and different colours can be used to indicate progress with orders, and the information can also be used as a reference Point for estimated prices, suppliers used, and cash forecasting. In addition, this form also serves as a means to provide feedback and handle queries from requesters on progress with their requests, and status of orders. PSR need to be circulated to be circulated to requesters to provide updates at least on a bi-monthly basis. Procurement should ensure that Requesters are kept informed on all progress, and any issues or delays faced in the procurement of their items that need immediate attention shall not wait the bi-monthly report and must be communicated in a proactive manner ‘The Procurement Tracking Sheet can also be used to manage the performance of the Procurement Team as it details time taken for different stages of the procurement process. For supervisors this allows monitoring of performance at each stage of the process, identifying where delays occur, and providing necessary support in those areas, 4.7. Supplier Checks and Anti-Terrorism Screening All suppliers must undergo the Plan Anti-Terrorism Screening (ATS) process. IH will take the ATS data directly from SAP (vendor list) and where a party is not in SAP (vendors not entered on SAP due to one off payment) then the ATS focal points will need to email the ATS inbox; ats@plan-international.org with the specific details. For vendors on SAP, after 2 UK working days have passed from the screening date (Friday each week) should you not hear from the IH ATS team then you can proceed with the engagement with the relevant party. For example, entry into SAP on Monday will be picked up on Friday's SAP data screening and the results will have been reviewed by the end of Tuesday the following week. All ad hoc requests should be emailed to the ATS inbox and a response will be received within 2 UK working days from receipt of the email, either with a request for further information or a conclusive answer of Clear response; High risk party; or Prohibited party. Ad hoc requests as part of a DRM response will be given priority to all other ad hoc requests. These must be identified as such when sent to the ATS inbox. Results: (Clear Response — the party has been cleared for the time being. High Risk ~ management approval is required to proceed to engage the party. Prohibited Party - cannot be engaged by Plan International. seeFor suppliers where we plan to spend over €30,000 /ETB 1,000,000 in a single contract, or over €30,000 / ETB 1,000,000 over the course of a financial year, a full Supplier Questionnaire Form must be completed ‘Supplier Questionnaire Form, returned and risk assessed once per year. This forms the basis of the supplier assessment prior to creating the supplier record in the database (SAP) For suppliers where we plan to spend less than €30,000 /ETB 1,000,000, the minimum Supplier Registration Form must be completed and risk assessed once per year Supplier Registration Form. Vendor Records must only be created by the Authorised Vendor Creator for the CO / business unit. For COs, this will usually be the Country Logistics Manager. 48. Rai 1g a Purchase Order ‘The Purchase Order is an external document, which represents Plan’s contract with a vendor to supply the ‘goods or services as specified. A purchase order may represent whole or part of the value of the purchase requisition that has been approved by the budget holder. It must include: Vendor name / contact details Description of goods / services, specification, quantity ‘Actual, precise amount of the goods / services Cost Centre / Budget Code and WBS: Delivery date(s), delivery instructions and address(es) ‘Terms and Conditions, including standard Payment terms Purchase Orders in Plan are prepared and released in SAP. The SAP guidance available includes the following courses in Learn at Plan: Creating a Purchase Order (ME21N) Purchase Order Output (MESF) Collective Release of Purchase Orders (ME28) Individual Release of Purchase Orders (ME29N) Purchase Orders must be released by an authorised Pian Purchase Order Releaser. Plan Purchase Order Releasing Authority must be approved by a higher level purchaser, and must adhere to the Financial Authority Approval Limits Policy (FAAL). Release of the Purchase Order from SAP by the Purchaser equates to Purchaser's internal endorsement of the procurement process that shall be in compliance with procurement policies and procedures. It also gives ‘assurance that the corresponding documentations supporting the Purchase Order are in place for cross referencing and future reference purpose. Commitment of the Purchase Order with the external vendor shall be based upon hardcopy signature and stamp of the final approver in line with the DOA ie. PAM/HOLA/ CLT. Any Purchase Orders approved/ committed by delegated staff shall be supported by formal delegation authorization for accountability and future referencing. ae 22Role Limit (Euros) ETB) Level 1 Purchaser Up to €30,000 “Up to ETB 1,000,000 (e.g. PA level Purchaser) Level 2 Purchaser Up to €100,000 Upto ETB 3,300,000 (e.g. Country Logistics Managers tier A) Level 3 Purchaser Up to €150,000 Up to ETB 5,000,000 (e.g. Country Logistics Managers tier B, DCD Ops, Senior Central Purchasers) Level 4 Purchaser Up to €500,000 Up to ETB 16,500,000 (e.g. Head of Logistics & Procurement) Level § Purchaser > €500,000 > ETB 16,500,000 (CEO and Chief of Staff only) Ifa Purchase Order value exceeds a PO Releaser authorisation li must be escalated to a higher level Purchase Order Releaser with sufficient authorisation (see table above). Within a transaction, the same person must not approve the Purchase Requisition (PR) and Release the Purchaser Order. Please note that, whilst up to now the Central Procurement services have not been charged, in order to increase the sustainabilty of this service, and align to peer organisations, a small transaction fee will be introduced from FY18, as described in the budget instructions. The transaction fee will be limited to 4% (or a maximum value cap for large orders) will be applied on the value of the Purchase Order processed. This will be automatically integrated into international orders. This charging model is acceptable and recoverable against restricted funds, but if you have any queries please do not hesitate to contact the CO Logistics and ‘Admin Department who will seek clarifications from the Central Procurement Team directly. 4.8.1. Tolerances ~ PR to PO Occasionally, minor variations occur between Purchase Requisition and Purchase Order. This is allowable without re-authorisation up to certain defined lir Up to 10% of the item’s unit value (from PR to PO), up to a maximum line item value of €1,500/ETB 50,000 Above this, the PR will need re-approval from the PR Approver, as the impact on the budget needs to be accepted and approved by that budget holder prior to purchase. The tolerance from PR to PO are SAP ‘System controlled, and an error message will be issued when they are exceeded, Procurement of a certain threshold will be processed based on the estimated PR amount. This is to mean that a PR with threshold for three quotations will not be cancelled when the actual analyzed amount falls under five quotations limit. However, if a five quote level procurement falls under tender level on a significant level, to ensure competitiveness in the process it shall follow the tender process. For this reason price estimates are expected to be as realistic as possible and Logistics and Admin Department shall be able to provide support to requestors in this renee 2B4.9. Procurement Waivers Itis important to adhere to the processes and procedures outlined in this manual and keep exceptions to an absolute minimum, The standard procurement processes and procedures on this document have been developed considering different contexts, market environments and donor regulations which entails that procurement waivers must be exceptionally used and only when justified Procurement waivers are an authorized exception from a competitive process, as such this may be waiving competition in a tender, or competition in a quotation process, or waiving the method or duration of advertising. See Quotation / Tender Waiver template. ‘When a procurement waiver is proposed, in some cases a prior approval may be from the donor (e.g. derogation) before initiating the internal waiver (refer to agreement with donor to note specific requirements) Justifiable reasons for a waiver may include: 1. Sole sourcer limited distributor(s) 2. Emergency response 3. Lack offpoor market response to tender “Emergencies’ due to delay, deliberate or otherwise, or failure to plan adequately does not constitute a justifiable reason for to obtain a procurement waiver. All waivers must be supported by a minute from the Procurement Committee, endorsed by PAM and approved by Head of Logistics and Admin Department prior to final authorization by the Country Director. Waiver Approvers must check the validity of any process which has been followed and any evidence of e.g. advertising with poor market response, sole supplier status, etc. and must decide if the justification is valid and the risk is acceptable to Plan. Waiver Approver must also check if there is Restricted Funding and if so, if donor derogation had been sought and obtained. All Purchasers must track and monitor waivers approved by quarter, and appropriate training or management actions taken where repeat waivers are requested 4.10. Consultancy Services Consultancy services may be in the form of a one-off piece of work with fixed deliverables, such as a project evaluation, a review, a piece of research, specialist technical input or a policy paper development, or it may be a professional service which repeats from time to time such as auditing, training / facilitation, translation, legal advice, tax or customs consultancy. Consultancy Services must be for a clearly defined business need, {follow all required Procurement process and be against an authorised budget with all details confirmed in a contract If an individual consultant will be performing consultancy services, they should be established as seff- ‘employed or a company and any work must be detailed in a contract, as with any other consultancy services. The duration of an individual consultant's work for Plan must not exceed 12 months. In addition, consideration must be given in line with the utilisation of contract resources to the legal entity situation in country. In the case of a consultancy with Pian Limited, the consultant must be based in the UK. sees PyFor more guidance on the procurement process for consultancy service, please refer to: Consultancy Service and Temporary/Agency Workers Business Process Flow Chart and the HROD Talent Acquisition Policy on Planet as well as local SOP PIE-004/18. 4.11. Supplier Management and Performance ‘Supplier Management and Performance involves measuring, analyzing and managing a supplier's ability to meet, and preferably exceed, their contractual obligations with Pian International ‘As soon as a contract or Purchase Order is issued, it's critical to identify within Pian, who will be managing the supplier performance for the duration of the delivery of goods / services. ‘Supplier Performance Management must be conducted on all contracts where delivery will be over a scheduled period of time (i.e. not a one off service / purchase), It is important to meet regularly with the supplier, review performance, service, quality, delivery, seek feedback on Plan's contract management (e.g. payments on time, receipting, communications) and to clearly document any performance issues, any failure to meet contractual obligations, any decisions, or actions to be taken, It is the responsibilty of the Procurement Committee to make such Supplier Management and Performance Reviews, recommended decision of the committee shall be approved by PAM or HoLA and documented for future reference. Refer procedure for Vendor Blacklisting on Annex V: SOP PIE-005/18 4.12. Special Requirements for the Procurement of Medical Supplies and Devices When procuring medical and pharmaceutical supplies they must be on the national essential medicines list, or on the World Health Organisation's list of essential medicines, (the latter also includes proprietary medicines / generics, and therapeutic food to address acute malnutrition). ‘The supplier must meet all requisite nationally and internationally recognized standards for the supply of medical suppliers and / or devices, including quality assurance, manufacturing, sourcing and cold chain. All suppliers should be able to provide evidence that their premises and facilities meet nationally and internationally recognized standards; that they technically capable of ensuring the quality of active ingredients, and their products (including components and ingredients) come from certified suppliers / sources. Any purchase of medical and pharmaceutical suppliers / devices must include formal technical authorisation by a qualified specialist prior to purchase — either internal or external as available and best fits the purchase. ‘Any supply of medical / pharmaceutical supplies / devices must be delivered by a qualified shipping agent / freight forwarder, including detailed mapping of any and all customs / import requirements and regulations prior to contracting, aeAl suppliers should follow WHO principles for the production and handling of medical supplies including; Production Storage and Distribution Quality assurance ‘A mechanism for ongoing monitoring of the production and quality control activities Monitoring of customers complaints and remedial follow-up Quality Management Standards (e.g. 1$09001/2008) Quality assurance assessments by other entities (e.g. QUAMED, IMRES, USAID) ‘The award of any contracts must also fully comply with, or evidence exemption from, the national medical / pharmaceutical regulations or equivalent legislation in the country of destination, ‘You must obtain and retain certificates of conformity, proof of quality and any other relevant documentation concerning the medical / pharmaceutical supplies / devices and all suppliers’ certificates, due diligence and QA documents. Medical Devices Medical Devices may include any instrument, apparatus, implement, machine, appliance, implant, in vitro reagent or calibrator. Note that this also includes medical aids such as walking sticks, wheelchairs, hearing aids. You must always ensure that you verify that the devices are designed, manufactured and are used for their primary purpose, and that where relevant the items can subsequently be maintained correctly in the country of destination. You must also check with national authority guidelines and WHO guidance on relevant specifications, When procuring medical items or supplies for an ECHO or Europe Aid funded project, you must purchase the items from a certified Humanitarian Procurement Centre (HPC). You must register the suppliers in the normal way but, for EC funding only, you do not need to undertake a competitive procurement process. Refer to Humanitarian Procurement Centers_on the DG ECHO website for more details but in all cases these requests must be via the Central Procurement team who will process these orders on your behalf rocurement@plan-international.or For more guidance on the purchase of medical / pharmaceutical supplies / devices, please refer to the WHO guidelines here: htto://apps.who. intimedicinedoos/en/d/Jwhozip49e/ 4.13. Special Requirements for the Procurement of Food Items. For the purposes of this SOP, food items includes: Grains / processed Grains (including flours, rices and pulses, wheat, sorghum, barley, etc.) Mixed foods Ready-to-use foods 4 Fortified foods with added vitamins and minerals ‘Supplementary foods to address moderate malnutrition ae 6When procuring food supplies, you must ensure that they comply with all applicable quality standards according to the national legislation of the country of origin and/or the country of destination, whichever has the higher quality standard, Prior to the decision to distribute food, particularly for grains / processed grains, a market impact assessment must be completed to examine the potential impact of food distribution on local markets and suppliers, particularly those markets immediately surrounding beneficiary populations. Where alternative methodologies can be employed, including cash based programming and market strengthening, these should always be exhausted prior to start-up of a food distribution activity Food sourcing should wherever possible follow the principle “as local as possible, as international as necessary’, but this should not conflict with the principles of Do No Harm, nor the quality standards detailed above. When procuring food items for an ECHO or Europe Aid funded project, you must purchase the items from a certified Humanitarian Procurement Centre (HPC). You must register the suppliers in the normal way but, for EC funding only, you do not need to undertake a competitive procurement process. Refer to Humanitarian Procurement Centers on the DG ECHO website for more details but in all cases these requests must be via the Central Procurement team who will process these orders on your behalf procurement@pian- international.org For more guidance on the purchase of food items, please refer to: WEP Reference Link For Market Assessment advice, support and tools, please refer to: Logistics Cluster cash and markets Resource: http://staging logcluster org/cashandmarkets Seeds and Plants You must ensure that the supplier provides documentation confirming that the seed or germplasm is, if applicable, officially released or otherwise approved by the government or district of the country in which they are procured and in which they are intended for use. Seed / germplasm / seeding procurement must consider the germination and planting cycles, conditions and geographically contextual variations. For all purchases of this type, delivery buffer periods must be included as mandatory so that germination periods are not missed. ‘You must ensure that agricultural specialists are able to verify the quality of the seeds / plants and must authorise the supplier selection. A declaration of quality must be obtained from a recognised seed laboratory and should be provided by supplier as proof of quality for every batch. Se % 24.14. Emergency Response Logistics and Procurement In an emergency response, the majority of this SOP in particular and the Operations Manual in general for Logistics & Procurement is applied as normal. However, for first phase emergency response, and only with prior written authorisation from the Country Director and Head of Logistics & Procurement, the following increased procurement method thresholds may be applied up to a maximum of 3 months from the onset of the response: 4.14.1. First Phase Emergency Procurement Thresholds Procurement Method Limits (Euros) Limits in (ETB) Direct PurchaselSingle Quote €- €5,000 Below 160,000 ‘Competitive Quotations > €5,000- €50,000 | 160,007 — 7,600,000 Market Determined Tender (MDT) __ | > €50,000- €150,000 | 1,600,001 — 5,000,000 International Published Tender (IPT) | = €150,000 ‘Above 5,000,007 4.14.2. First Phase Emergency Advertising Periods ‘Where the above thresholds have been approved, it is permissible to reduce the advertising period for both Market Determined Tenders (MDT) and International Published Tenders (IPT) to 5 working days, provided that the Tender Documentation to be submitted by suppliers is achievable within that timeframe, to allow a ‘competitive pool of suppliers the opportunity to respond Ifyou are stil unable to complete a competitive process due to the emergency response, then you can apply for a procurement waiver as per section 4.7 of the manual. Whilst all of Plan’s institutional and individual donors rightly expect us to strive for value for money under all circumstances, it is accepted that life-saving efforts in the immediate aftermath of a rapid onset crisis can take precedent over competitive process. For COs with high vulnerability to emergencies, it is critical to plan for future response scenarios (reference POP), and to put in place preparedness measures including supplier assessments, questionnaires, vendor setup on SAP, Long Term Agreements with suppliers, as well as identifying potential office, warehouse and accommodation arrangements, contacts and supply routes in the event of a response. In some circumstances, it may be necessary to process part of the procurement process offline, rather than in the SAP system. This must only be done after endorsement of PIE Head of Logistics and Admin Department and approval from Country Director. This is to be done in consultations with the Global Logistics and Procurement team and on the advice of the Global HelpDesk. =a5. RECEIVING Receiving Goods, Services and Assets (SAP System receipting, quality assurance and inspection, part receipt) 5.1. Checking and Receiving Deliveries On arrival of goods, materials or equipment at a location, the Pian staff receiving the items must: Cheek that they have been delivered to the correct location, Check that the delivery has been received in full as per the Supplier and Transporter delivery documents (e.g. Waybill, Supplier / Transporter’s Delivery Note or Consignment Note) AND as per the Purchase Order and what was expected. Examine and check all items for: damage, correct specification, expiry dates, quality (which may be against an agreed reference sample provided). Complete a GSRN (see below). The Receiver must be competent / qualified to inspect the items they are receiving. If they are not confident in assessing the items, they must also seek a technical expert for those items to counter-sign receipt. Examples may include: vehicles, specialist engineering equipment, IT equipment where a technical expert should verify receipt For the receipt of services, the Plan staff Receiving must follow a similar process and verify that the services have been received according to what was expected, matching with the Purchase Order, Contract and any supplementary information (for instance consultancy delivery schedule, final report, workshop delivery confirmation), Every time a delivery of materials / services is received to a location from a supplier, a GSRN must be completed and issued immediately after the materials are checked, using the Goods / Services Receipt ‘Note (GSRN) Template and then posting MIGO step on SAP. 5.2. Returning Materials to Suppliers It is extremely difficult to return materials to suppliers once Plan International has already confirmed acceptable receipt. It is for this reason that itis critical to make sure that the goods / materials are acceptable and according to our Purchase Order before signing any Delivery Note / GSRN / Waybil from a Vendor. If problems are detected, for example; wrong quality or quantity, loss or damage, then these materials must ot be accepted and the supplier must be informed. Depending on the extent of the problem, the entire delivery may be rejected, or part of the delivery may be accepted and part rejected. In this second case, the supplier's / transporter’s document should be marked to indicate clearly that only part receipt has been accepted and a copy retained Prior to informing the supplier, the defect must be reported to the Purchaser. This person will then contact the supplier to take the matter forward. one 29Note: If delivery documents are not immediately completed with details of wrong specification / loss / damage etc., then Plan may be liable to pay the supplier in full For purchase orders where this has happened, the following must happen: Note details of the issue on the transport document and the Goods Received note. 5 Inform the purchase officer to contact the supplier immediately © Initiate claims action — carrier / supplier — insurance. A report must be prepared by the Purchase Officer to the supplier, identifying the details of the issues with reference to the original contract, and then negotiate the return or re-supply, or repair of the faulty goods, ‘The acceptable options are The supplier supplies a suitable replacement at no charge, arranges collection, handling and freight costs, The materials are returned to the supplier and a full credit is issued with freight costs included. ‘The goods are scrapped with the approval, in writing, of the supplier and / or insurance company. Se 30ACRONYMS ATS co cur co DOA DRM ere FAAL FAD GSRN HoLA, HEC. ict er rm rary MoT PoP PA PAM PIE POP PR PSR RFQ RO sop ‘Anti-Terrorism Sereening Country Director ‘Country Leadership Team ‘Country Office Delegation of Authority Disaster Risk Management Ethiopian Birr Financial Authority Aporoval Limits Policy Funding Agreement Document ‘Goads'Services Receipt Note Head of Logistics and Admin Humanitarian Procurement Center Information Communication Technology International Headquarters International Published Tender (IPT) Invitation to Bid Invitation to Tender Long Term Agreement Market Determined Tender Operational Manval Process to Pay Program Area Program Area Manager Procurement Committee Plan International Ethiopia Purchase Order Project Operation Plans Project Operation Pian Purchase Requisition Procurement Status Report Request for Quotation Regional Office ‘Systems, Applications and Products ‘Standard Operating Procedure 3ANNEX ‘Annex ‘Annex I ‘Ann@x Annex IV aAnnexV Annex Vi Annex Vil CLT Endorsement Page Consultancy Service Procurement SOP Procurement Status Report Procurement Committee TOR ‘Vendor Blacisting SOP Construction Tendar Guideline COn-force Construction Guideline 2