Procurement and Supply Chain Management Made Simple: Increasing sales, profitability and customer service through the eradication of commercial costs, waste and risks.
The Utilisation of Open Tendering One of the primary benefits of using open tendering is that it offers an equal opportunity for all suppliers to participate in the procurement process. This encourages maximum participation from suppliers and ensures that the organisation receives competitive bids. The open and transparent nature of the process also reduces the risk of corruption or favouritism. However, it must be emphasised that open tendering is often believed to be biased towards the least-cost option. This is only sometimes the case and depends on the scoring criterion used to judge the suitability of suppliers' tender submissions. Where price is not the primary concern of a potential requirements solution, the tender's price/quality scoring ratio must be carefully considered to find a balance that best meets the organisation's needs. Open tendering is a fair, transparent, and competitive procurement process that offers equal opportunity to all suppliers. It encourages innovation and leads to cost savings for the organisation and technological advancements for the industry. Organisations should consider the price/quality balance that best meets their needs to ensure an open tender process is fair and unbiased. Simply opting for the lowest-cost option may not necessarily be the best award decision within a tender, as it may compromise the quality of the product or service an organisation receives. By weighing the award of a tender based on the price against quality to best meet the organisation's requirements, organisations can make an informed, cost-effective decision that meets their needs without the result of a tender being driven solely or predominantly by cost alone. ©️ Procurement and Supply Chain Management Made Simple. All rights reserved. #procurement #procurementtransformation #procurementmanagement #procurementstrategy #supplychainmanagement #supplychain #supplychainexcellence #purchasing #purchasemanagement #commerical #business #managementconsulting
