What is this Procurement Thing? - YouTube

Hello, and welcome to today's recorded training on procurement.Today's training

is specifically for the Child and Adult Care Food Program sponsors and Summer

Food Service Program sponsors, but procurement rules are the same for all

child nutrition programs. So in today's training we're going to be talking about

what procurement is, why it's important, when you use it, and some basic

procurement requirements. So what is procurement? You may have heard us start

using this term ,and you may have seen it in some of the communications that we've

sent to you, but it may be a word that you're very unfamiliar with. Well believe it or

not, procurement is something that you are actually familiar with because you

procure things all the time. What do we mean by that? Well, procuring is when you

buy groceries, it takes place when you're purchasing a household appliance, it also

happens when you're contracting for a house or car repair. So even though the

term may be unfamiliar to you, many of the concepts of procurement will seem

very familiar. That's because procurement is buying stuff- but actually it's more

than buying stuff, it's a multi-step process for obtaining goods products and

services at the best possible price. One of the easiest ways that I can think of

to describe procurement is to describe the procurement process. What I'm going

to do is walk you through the steps of a procurement process and then try to put

each step into common terms and concepts that you're familiar with- so let's take

a look. So the first step in the procurement process, is developing

procurement procedures. So you can think about this, or what are your rules around

procuring or purchasing things? So for your center, or for your organization,

it might be who is allowed to purchase things? What are your roles around

purchasing? Are you just you allowed to purchase things? Do you let other

employees purchase things? Does it depend on where they're purchasing it from? If

they are ordering it online, does somebody do that? If it's going to the

grocery store? Or is somebody in charge of that? When I think about my own household

and I think about our procurement procedures, it might be something like

telling my teenage children that they're not allowed to go online and buy

whatever they would like. So again, developing procurement procedures is the

first step in the process. We're going to talk more about it later, but just know

that that's what it means- setting up YOUR rules around purchasing items.

So the next step in the procurement process is forecasting and planning. So what do

we mean by that? That's basically- think about making your grocery list. What do I

need? How much do I need? How big of a time am I planning for? Am I buying

groceries for a day, for a week, or for a month? So again, it's that thinking

through how much do I need, and when do I need it? This is where you'll also take

into consideration how many meals you're planning- so how many children are going

to be in attendance? How many sandwiches do you need to make? Or whatever item is

on the menu. So again, the second step in the procurement process is forecasting

and planning- and that's deciding how much and when do you need it.

The next step in the procurement process is selecting the proper procurement method.

Now for this- this is where the federal regulations really take effect and are

very prescriptive on how much money you're going to spend and what rules you

have to follow for procurement. So again, it's based on the value, the dollar

amount, that you will be spending. In a later training we will go into detail

about the different procurement methods and the dollar value that is attached to

each of those methods.

The next step in the procurement process is developing specifications or

solicitation. So what does that mean? That's when you decide what kind or type

of items, and what features. So if you think about a grocery list, this might be

where you decide do you want fresh apples or applesauce? What features do

you want something to have- so think about when you're buying a washing

machine. What features do you want it to have? What functions do you want it to

have? So again, developing specifications or solicitation is just a fancy way of

saying making the determination about the kind and type of products that you

need. The next step in the procurement process is evaluating quotes, bids, and

proposals. So this is when you determine who has the best price that meets the

specifications I'm looking for? So maybe if you are trying to purchase a car and

you know what kind of car you want, you know what kind of features. This might be

where you go to different dealerships and compare the item that you're looking

for. Who has the best price? That with a car that meets all the features that you

would like? The next step in the procurement process is purchasing and

awarding the contract- so this is where we actually get to buy something.

So, sometimes one thing people think about procurement, this is a stuff they think

about- the actual purchasing. But the point that we're trying to make today is

that there's all these steps that go into the process before and after you

actually make the purchase. And then one of the final steps in the procurement

process is receiving and managing the contract. So, for this think about after

you purchase something. Did you get what you paid for? Does it have the qualities

and features you determined that you needed? So maybe you did buy that new

washing machine- it gets installed, you go use it and suddenly you realize that it

doesn't do what you thought it should. Or something of the feature doesn't work.

That would be a concern. That's receiving and managing the goods that you've

purchased, and evaluating. So why are we having to talk about procurement so much

in Child Nutrition Programs? Proper procurement has always been a

requirement when you're using your federal funds. This makes sure that we

take federal funds- that are taxpayers dollars- and we efficiently and

economically use them in compliance with the rules and the laws. There's been an

increased focus, when the- when there was the passage of the uniform grant

guidance was back in December of 2013. But it provided more details and further

clarification for federal programs. USDA has also placed an increased focus on

procurement and Child Nutrition Programs- thus we're passing on that information

to you, our sponsors. When we think about procurement, we think about good use of

federal funds and also the idea of embracing competition. When there's a lot

of competition it means that there's a level playing field, and when there's a

level playing field that means more people- more vendors are participating

and offering their services. And then if we have more vendors vying for services

and offering us items to purchase, the cost of these products and services will

be lower. So in the end, we end up using our federal money more efficiently and

effectively. The procurement process ensures that the sponsor receives goods

and services from the most responsible vendor, from the most responsive bid, and

at the lowest possible price. Again, it's the best use of federal funds. On this

screen, I'm showing you the quotations for the rules- the law of procurement.

So they can be found in 2 CFR 200, and 7 CFR. As part of the Child

Nutrition webpages, we've dedicated a set of pages to procurement. On these

pages, you will find links to many of the resources that we are developing to

assist you in implementing these procurement rules. One of the items that

you'll find on this webpage, is a document that provides links to all of

the federal regulations and all of the USDA guidance pertaining to procurement.

So when do we have to follow procurement rules? Anytime you decide to purchase, you

have to use the procurement process, and follow the procurement regulations. So it

doesn't matter if you're spending $500 or $5,000, there's the process that must

be followed, and rules that must be followed.

Procurement often feels like a whole-other-language, one of the documents

that we have prepared for you, is called Procurement Vocabulary. It is available

on the webpage that I referred to just a minute ago. This is a great resource to

hand- to print out and have handy, so when we're talking about procurement, you can

look and see some of the different terms and make sure you understand what we're

talking about. So as I mentioned before there are several procurement

requirements. The first one- the first step in the procurement process that we

mentioned earlier was developing procurement procedures. So remember these

are your rules and the steps to what you do in purchasing. One of the requirements

of the- for federal nutrition programs is that you have to have a procurement

procedure plan. A procurement procedure plan is a written document that

describes how your organization will conduct procurement transactions in

accordance with federal, state, local, and tribal laws and regulations. So it's

required that you have this, it helps you determine procurement

methods to be used. It prohibits conflicts of interest and includes a

written code- written code of standards of conduct. On our webpage we have a

document that talks about the procurement procedure plan- on it you

will see a bulleted list of all the items that need to specifically be

included in your procurement procedure. We're also working on developing a

template that will also help you complete this step. One of the particular

items that need to be included in your procurement procedures is direction and

written definitions of minority business enterprises. So in your procurement

procedures, it specifically needs to say that you will solicit minority business

enterprises whenever they are they are potential sources for purchasing, when

economically feasible, and that you will establish a delivery schedule which will

assist minority business enterprises to meet deadlines. The specifics on this

exact language that needs to be in your procurement procedures are included in

that reference sheet- Procurement Procedure. One of the items that needs to

be included in your procurement procedures is a code of conduct. We also

have a reference sheet that talks about the code of conduct. The code of conduct

governs the ethical conduct and action of employees- sometimes it's called the

conflict of interest. So why you have to have a code of conduct? Well for one

thing, it protects the reputation of the sponsor. So again remember that these are

federal funds that you are using. You want to make sure that it's clear to

everybody that your organization is reputable, and you are using federal

sources in a responsible manner. Having a code of conduct also proactively

prevents unethical behavior- it helps employees understand and avoid unethical

behavior and it clearly lays out consequences of unethical behavior.

So again, if you're thinking about your staff and you allow other folks to do

procurement practices- meaning that you allow them to do your grocery shopping-

you want to make sure that they understand that when they go to do that

grocery shopping, purchasing items for their own personal use or benefit would

not be allowed and what would be the consequences if they were to do that.

So what's next for you? Well we plan to offer you more trainings- recorded and

live webinars- to help you understand the procurement procedures and the

procurement rules. We encourage you to visit the OSPI Child Nutrition Procurement webpage

and start looking at the procurement documents that are

available for you. And we also encourage you to start drafting that procurement

procedure plan- including the code of conduct. And again, you'll find the

resources on that webpage to assist you in doing that. Thank you for spending the

time to listen to this training and we look forward to you joining for us for

trainings in the future. Thank you.