Procurement planning is the process of deciding what to buy, when and from what source. Procurement planning is the primary function that sets the stage for subsequent procurement activities. A mistake in procurement planning has wide implications for local governance, measured from the two indicators of accountability and participation. The ideals of planning suggest that procurement planning can be implemented in an atmosphere of complete harmony. As a function, procurement planning endeavors to answer the questions of what do you want to procure;
- When to procure it;
- Where to procure them from; when the resources be available;
- The methods of procurement to be use; how timely procurement or failure will affect the user of the item(s);
- The procuring and disposing entity; efficient in the procurement process; and the people to be involved in the procurement.
During the procurement planning process the procurement method is assigned and the expectations for fulfillment of procurement requirements determined. A good procurement plan will go one step further by describing the process one will go through to appoint those suppliers contractually. Whether you are embarking on a project procurement or organizational procurement planning exercise, the steps will be the same. Procurement is thus one part of the commissioning process. It refers to a specific method of purchasing services which involves tendering for a contract. Sometimes it is more appropriate for a public body to fund a service through the provision of a grant, but then it will have less control over the precise outcomes to be delivered.
Procurement must take a thoroughly professional view of its role in business as a whole and that must include planning. Any procurement begins with the planning decision to make the purchase and this will involve in the first place, deciding whether there is a need for the particular goods or services, ensuring that the purchaser has the legal powers to undertake the transaction, obtaining any relevant approvals within the government hierarchy and arranging the necessary funding. The ultimate goal of procurement planning is coordinated and integrated action to fulfill a need for goods, services or works in a timely manner and at a reasonable cost.
Procurement planning is undertaken as part of the program/service planning process. The primary concept of procurement is that planning, scheduling and bulk purchasing result in cost savings, efficient business operation, and increased value for money. The public sector is expected to use procurement planning as an opportunity to evaluate/review the entire procurement process so that sound judgments and good decision making will facilitate the success of the overall project implementation in the procurement of goods, works and services.
